Disclaimer: Rate data updated April 14, 2026. Rates change daily — contact lenders directly for current quotes. DSCRFinder.com does not guarantee rate accuracy.
DSCR Loan Rates for Multifamily Properties — 2026
DSCR loans are available for 2–4 unit residential investment properties (duplexes, triplexes, and fourplexes). Multifamily properties often produce stronger DSCR ratios than single-family homes because combined rent from multiple units provides more income relative to the purchase price — making them excellent candidates for DSCR financing.
As of April 2026, DSCR rates for multifamily 2–4 unit properties run 7.25% to 9.00% — approximately 0.125%–0.375% above comparable single-family rates.
Multifamily DSCR Rate Table — April 2026
| Borrower Profile | DSCR | FICO | Down Payment | Rate (SFR) | Rate (2–4 Unit) | |---|---|---|---|---|---| | Best-qualified | 1.25+ | 740+ | 30%+ | 7.15% – 7.50% | 7.25% – 7.75% | | Strong | 1.25+ | 720–739 | 25% | 7.50% – 7.75% | 7.75% – 8.00% | | Standard | 1.0–1.24 | 680–719 | 20–25% | 7.75% – 8.25% | 8.00% – 8.50% | | Moderate | 0.75–0.99 | 660–679 | 20% | 8.25% – 8.50% | 8.50% – 8.75% |
Multifamily (2–4 unit) rates are typically 0.125%–0.375% higher than SFR rates for the same borrower profile.
Why Multifamily Properties Excel for DSCR Qualification
The DSCR formula is: Monthly Rent ÷ PITIA
A 4-unit property with 4 × $1,200/month = $4,800 total rent vs. a single-family home renting for $1,800/month produces dramatically different DSCR ratios at similar purchase prices. This is the fundamental advantage of multifamily for DSCR investing.
Example Comparison
Single-family home:
- Purchase: $280,000 | Rent: $1,900/month | PITIA: $1,800 | DSCR: 1.06
Fourplex:
- Purchase: $480,000 | Combined rent: $4,200/month | PITIA: $3,200 | DSCR: 1.31
The fourplex produces a significantly better DSCR ratio — qualifying for a lower rate tier — despite being a more expensive property.
DSCR Loan Requirements for 2–4 Unit Properties
| Requirement | Typical Range | |---|---| | Minimum DSCR | 0.75 to 1.0 (lender dependent) | | Minimum FICO | 620–680 | | Down payment | 20%–25% | | Max LTV | 75%–80% | | Max loan amount | Up to $3M (some lenders to $5M) | | Units | 2, 3, or 4 | | Owner-occupancy | Not required (non-owner occupied allowed) |
How Lenders Calculate DSCR for Multifamily
DSCR lenders use Gross Rental Income from all units. Key considerations:
- Vacancy factor: Most lenders apply a 5%–10% vacancy deduction to gross rent. A fourplex with $4,800 gross rent may be underwritten at $4,320 (10% vacancy).
- Market rent vs. actual rent: Lenders typically use the lesser of actual rent or appraiser-confirmed market rent.
- Mixed occupancy: If you live in one unit, some lenders require owner-occupied financing (different product). Pure DSCR loans require non-owner-occupied investment properties.
- Utilities: If the owner pays water/sewer for a multi-unit, lenders may deduct this from income.
Best Markets for Multifamily DSCR Investing
| Market | Why It Works | |---|---| | Ohio (Cleveland, Columbus) | Very affordable duplexes/triplexes, strong DSCR ratios | | Michigan (Detroit suburbs) | High yields on 2–4 unit properties | | Memphis, TN | Extremely affordable multifamily, very high DSCR | | Buffalo / Rochester, NY | High yields, affordable prices | | Indianapolis, IN | Strong rent-to-value on multifamily | | Pittsburgh, PA | Affordable prices, growing economy |
DSCR Lenders for Multifamily 2–4 Units
Most DSCR lenders cover 2–4 unit properties. Key considerations when selecting a lender:
- Max units: Confirm the lender covers the specific unit count you need (some limit to 2-unit)
- Vacancy factor: Ask how they handle vacancy in DSCR calculation
- Rate premium: Understand the exact premium over SFR pricing
Use our lender comparison to identify lenders that serve multifamily properties.
Frequently Asked Questions
Are DSCR rates higher for multifamily vs. single-family? Yes, typically 0.125%–0.375% higher. The premium reflects slightly higher complexity and perceived risk for multi-tenant properties.
Can I get a DSCR loan for a 5+ unit property? No. DSCR loans are residential products limited to 1–4 unit properties. Five or more units require commercial real estate financing (different product, different underwriting).
Do all tenants need to be paying rent to qualify? No. Lenders typically use market rent for vacant units — or discount for vacancy. You can have vacancies and still qualify based on projected market rents.
Can I use DSCR financing to buy a duplex and live in one unit? Generally no — DSCR loans require non-owner-occupied investment properties. If you plan to live in one unit, you'll need an FHA or conventional loan (owner-occupied multifamily programs).
Related: Current DSCR Rates April 2026 | DSCR Rates by State | DSCR Calculator | Best DSCR Lenders 2026
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