DSCR Loan Rates in 2026: What to Expect and How to Get the Best Rate
DSCR loan rates are one of the most-searched topics among real estate investors, and for good reason. The difference between a 7.0% and 7.75% rate on a $400,000 investment property loan is roughly $200/month — or $2,400/year in cash flow.
This guide covers current DSCR rate benchmarks, the factors that determine your specific rate, how DSCR rates compare to conventional mortgages, and actionable strategies to get the best rate on your next deal.
Current DSCR Loan Rates in 2026
As of April 2026, DSCR loan rates for well-qualified borrowers typically fall in the following ranges:
| Borrower Profile | Typical Rate Range | |---|---| | Excellent (720+ FICO, 1.25+ DSCR, 25%+ down) | 6.5% – 7.25% | | Standard (680–719 FICO, 1.0–1.24 DSCR, 20–25% down) | 7.25% – 7.75% | | Moderate (660–679 FICO, 0.75–0.99 DSCR, 20% down) | 7.75% – 8.25% | | Challenging credit or DSCR | 8.25% – 8.75%+ |
These rates reflect 30-year fixed conventional DSCR programs for single-family investment properties. ARMs (adjustable-rate mortgages), interest-only periods, and different property types will produce different rate quotes.
Among the lenders on our comparison page, New Silver currently advertises the most competitive starting rate at 5.75%, followed by Beeline and Axos Bank at 6.5%. These starting rates apply to their strongest-profile borrowers; most investors will see rates 50–100+ basis points higher.
How DSCR Rates Compare to Conventional Mortgage Rates
DSCR loans carry a rate premium over conventional investment property mortgages of approximately 0.5% to 1.5%. This premium reflects:
- The non-QM nature of the loan (not eligible for government-sponsored enterprise (GSE) purchase)
- The higher perceived risk of alternative income verification
- Smaller secondary market for DSCR loans vs. conventional mortgages
For reference, the Freddie Mac Primary Mortgage Market Survey tracks 30-year fixed rates for primary residences. Investment property conventional rates run 0.5%–0.875% above that baseline. DSCR loans add another 0.5%–1.5% on top of investment property conventional rates.
Example rate stack (April 2026):
- 30-year primary residence (Freddie Mac benchmark): ~6.75%
- Conventional investment property loan: ~7.25%–7.50%
- DSCR loan (well-qualified): ~7.50%–8.00%
- DSCR loan (moderate profile): ~8.00%–8.50%
What Affects Your DSCR Loan Rate?
Your rate is determined by a combination of macro market factors and your specific loan profile. Here's what has the most impact:
1. Credit Score (FICO)
Credit score has the single largest impact on your DSCR rate among borrower-controlled factors. The improvement from 680 to 740 FICO can reduce your rate by 0.5%–0.75% — worth hundreds of dollars per month on larger loans.
| FICO Score | Typical Rate Adjustment | |---|---| | 740+ | Best pricing tier, no adjustment | | 720–739 | +0.125% to +0.25% | | 700–719 | +0.25% to +0.375% | | 680–699 | +0.375% to +0.50% | | 660–679 | +0.50% to +0.75% |
These are approximate — actual adjustments vary by lender and loan size.
2. DSCR Ratio
Higher DSCR ratios signal lower risk to lenders, and that's priced into your rate:
| DSCR Range | Typical Rate Adjustment | |---|---| | 1.25+ | No adjustment (base rate) | | 1.10–1.24 | +0.125% to +0.25% | | 1.0–1.09 | +0.25% to +0.375% | | 0.75–0.99 | +0.50% to +0.875% (where available) |
A property barely qualifying at 1.0 DSCR will typically pay meaningfully more than a property at 1.30 DSCR, all else being equal.
3. Loan-to-Value (LTV) / Down Payment
DSCR rates, like all mortgage rates, are sensitive to LTV. The more equity you put in, the lower the lender's risk exposure, and the better your rate.
| LTV / Down Payment | Typical Rate Impact | |---|---| | 65% LTV (35% down) | Best tier — lowest rate | | 70% LTV (30% down) | Competitive rate | | 75% LTV (25% down) | Standard — most common | | 80% LTV (20% down) | +0.25%–0.50% vs. 75% LTV |
Going from 20% to 25% down can save you 25–50 basis points (0.25%–0.50%) on your rate in addition to reducing your loan amount. Double benefit.
4. Property Type
Single-family residences receive the most competitive DSCR rates. Other property types carry adjustments:
- Single-family (SFR): Base rate
- 2–4 unit: +0.125% to +0.25%
- Condominiums: +0.125% to +0.375% (varies by building type)
- Short-term rental: +0.25% to +0.50% (additional data requirements)
5. Loan Amount
Larger loan amounts can sometimes access better pricing — a phenomenon called "jumbo pricing" — though this depends on the lender:
- Loans above $1M: Some lenders offer reduced rates for jumbo DSCR loans, particularly specialist lenders like Griffin Funding and Axos Bank
- Loans below $200K: Some lenders charge small-loan fees that effectively increase the rate
6. Prepayment Penalty Terms
This is one of the most underappreciated rate factors. DSCR lenders offer meaningfully lower rates when you accept a prepayment penalty — and the longer the penalty period, the lower the rate:
| Prepayment Structure | Rate Impact | |---|---| | No prepayment penalty | Highest rate (+0.5%–1.0%) | | 3-year step-down (3-2-1) | Moderate rate | | 5-year step-down (5-4-3-2-1) | Lowest rate in category | | 10-year | Lowest available rates |
If you plan to hold the property long-term (5+ years), accepting a 3–5 year prepayment penalty typically produces significant rate savings that more than compensate for the restriction.
7. Rate Lock Period
Like all mortgage products, the length of your rate lock affects your rate:
- 15-day lock: Cheapest — but very tight timeline
- 30-day lock: Standard
- 45–60 day lock: Adds 0.125%–0.25%
- Extended lock (90+ days): Adds 0.25%–0.50%
Request a 30-day lock unless you have specific reason to need more time.
How DSCR Rates Relate to Fed Policy and Treasury Yields
DSCR rates don't exist in a vacuum — they move with broader interest rate markets. The primary driver is the 10-year US Treasury yield, which serves as the benchmark for long-term fixed rates.
Federal Reserve Economic Data (FRED) provides real-time Treasury yield data. When 10-year Treasury yields rise, DSCR rates rise proportionally. When yields fall, DSCR rates follow — typically with a 30–60 day lag.
The spread between DSCR rates and Treasuries (typically 200–350 basis points for DSCR vs. 150–225 for conventional investment property loans) reflects:
- Non-QM loan risk premium
- Smaller secondary market liquidity
- Lender profit margin
- Market competition in the DSCR space
Rate forecasting is notoriously unreliable, which is why we recommend using current rates in your underwriting rather than betting on favorable movements.
How to Get the Best DSCR Loan Rate
1. Improve Your Credit Score
If you have time before your next deal, improving your FICO score from 680 to 720+ can meaningfully reduce your rate. The most effective tactics:
- Pay down all revolving balances below 20% utilization
- Dispute and correct any errors on your credit report
- Add yourself as an authorized user on a family member's old, clean account (thin-credit investors only)
- Avoid new credit inquiries for 90+ days before applying
2. Make a Larger Down Payment
If capital allows, 25% down consistently outperforms 20% down on DSCR rate pricing. The rate improvement plus the reduced loan balance creates a compounding benefit.
3. Accept a Prepayment Penalty
For buy-and-hold investors who plan to own properties for 5+ years, accepting a 3–5 year step-down prepayment penalty can reduce your rate by 0.50%–1.0%. Over a 5-year hold period, the rate savings almost always exceed any penalty you'd face.
4. Select a Property with Strong DSCR
The DSCR ratio of the property itself affects your rate. Using our DSCR calculator during deal analysis allows you to screen for properties that will qualify for best-rate pricing before making an offer.
5. Shop Multiple Lenders — Compare APR, Not Just Rate
This is the most important step most investors skip. DSCR rates vary significantly lender-to-lender on identical deals. Getting quotes from 3–5 lenders before committing can save 0.25%–0.75% on your rate.
Compare APR (Annual Percentage Rate), not just the stated interest rate. APR incorporates origination fees, points, and other lender costs into a single comparable figure. A lender offering 7.25% with 2 points might be more expensive than one offering 7.50% with 0 points — the APR comparison reveals the true cost.
6. Watch for Junk Fees
Beyond points (origination, discount), watch for:
- Underwriting fees ($500–$1,500)
- Processing fees ($500–$1,000)
- Application fees ($250–$500)
- Rate lock extension fees (if closing is delayed)
- Wire transfer fees, document preparation fees
Legitimate lenders will provide a clear Loan Estimate within 3 business days of application. Compare these itemized estimates, not just the rate.
7. Consider an ARM for Shorter Hold Periods
If your investment strategy involves selling or refinancing within 5–7 years, a 5/1 or 7/1 DSCR ARM can offer meaningfully lower rates (typically 0.5%–1.0% below 30-year fixed). The risk is rate adjustment after the initial fixed period — acceptable if you plan to exit before then.
Next Steps
The fastest way to find your actual rate is to connect with multiple lenders. Use our lender comparison page to see which lenders serve your state and loan size, then get matched with multiple lenders simultaneously to receive competing quotes.
Always calculate your DSCR ratio before applying — knowing your number positions you to negotiate from a position of knowledge rather than guessing what you might qualify for.
Related: Best DSCR Lenders 2026 | Compare Lenders | DSCR Calculator | What Is a DSCR Loan?
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