DSCR rates are driven by credit score, LTV, DSCR ratio, property type, and loan amount. Here is what you need to know.
DSCR loan rates are typically 0.5%-1.5% higher than conventional investment property rates, reflecting the non-QM nature of the product. But the right combination of credit score, down payment, and DSCR ratio can get you competitive pricing — especially through a wholesale broker like xMortgageBroker who has access to multiple lenders competing for your deal. Here is what drives DSCR rates and how to position your deal for the best pricing.
Credit score is one of the biggest drivers of DSCR rates. A 740+ score typically gets the best pricing. Every 20-point drop in credit score can add 0.125%-0.375% to your rate. Improving your credit score before applying can save thousands over the life of the loan.
Lower LTV means lower rate. A 65% LTV deal will price significantly better than an 80% LTV deal. If you have the cash to put down more, it often makes sense from a rate perspective. The rate improvement from 80% to 75% LTV can be 0.25%-0.50%.
A higher DSCR ratio signals a stronger deal to lenders. Deals with 1.25x+ DSCR typically price better than deals at 1.0x or below. No-Ratio (0.50x) programs carry the highest rates due to the additional risk.
30-year fixed DSCR rates are the most common. 5/1, 7/1, and 10/1 ARMs are available at lower initial rates — useful if you plan to refinance or sell within the fixed period. Interest-only options are available on select programs.
Single-family homes typically price best. Condos, 2-4 unit properties, and short-term rentals may carry slight rate adjustments. Rural properties and unique property types may have limited lender options.
Loans under $150K may carry slightly higher rates due to lender minimum yield requirements. Jumbo DSCR loans ($1M+) are available but may have more limited lender options. The sweet spot for DSCR pricing is typically $200K-$1.5M.
You can buy down your DSCR rate with points (1 point = 1% of the loan amount). Whether buying down the rate makes sense depends on your hold period and cash flow goals. We will help you run the numbers to find the optimal rate/points combination.
As a wholesale mortgage broker, xMortgageBroker has access to lender pricing that retail banks and direct lenders cannot match. We shop your deal across multiple DSCR lenders simultaneously to find the best rate and terms for your specific deal.
DSCR rates change daily based on market conditions. Contact us for a current rate quote based on your specific deal — credit score, LTV, property type, and loan amount all affect your rate. We will shop multiple lenders to find the best pricing.
Yes, typically 0.5%-1.5% higher than conventional investment property rates. DSCR loans are non-QM portfolio products, which carries a slight rate premium. However, the ability to qualify without personal income documentation often outweighs the rate difference for investors.
Yes. Interest-only DSCR loans are available on select programs. An I/O loan maximizes your monthly cash flow by reducing your payment to interest only for the I/O period (typically 5-10 years). This can significantly improve your DSCR ratio.
The best DSCR rates go to borrowers with: 740+ credit score, 65-70% LTV, 1.25x+ DSCR ratio, single-family or 2-unit property, and loan amounts in the $200K-$1.5M range. Working with a wholesale broker like xMortgageBroker gives you access to multiple lenders competing for your deal.
Yes. Rate locks are typically available for 30-60 days. Extended rate locks (90-120 days) are available for new construction or longer closing timelines, usually at a small cost. We will help you time your rate lock to protect against rate increases.
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