DSCR (Debt Service Coverage Ratio) loan rates vary depending on the property, borrower profile, and market conditions — but they’re often competitive with other investment property loans.
While not based on personal income, DSCR rates are influenced by cash flow strength, credit score, and leverage (LTV).
📊 Typical Rate Ranges
DSCR Ratio | Credit Score | Loan-to-Value (LTV) | Estimated Rate Range* |
1.25+ | 720+ | Up to 80% | 6.75% – 7.75% |
1.10 – 1.24 | 680+ | Up to 75% | 7.75% – 8.50% |
1.00 – 1.09 | 660+ | Up to 70% | 8.50% – 9.50% |
Below 1.00 | Case-by-case | ≤ 65% | 9.50%+ |
*These figures are estimates and change based on market trends, loan type, and property specifics.
This is an information.
Rates typically fluctuate weekly based on the bond market and investor demand for mortgage-backed securities.
🧮 Key Factors That Influence Your DSCR Rate
DSCR Ratio: Higher ratios (more cash flow) = better pricing.
Credit Score: Each 20-point improvement can reduce your rate.
Loan-to-Value (LTV): Lower LTVs mean less risk and lower rates.
Property Type: Single-family homes often receive better pricing than condos or small multifamily.
Occupancy Type: Short-term rentals can carry a small pricing premium due to volatility.
Loan Term & Structure: Fixed rates are higher than ARMs, but provide long-term stability.
💡 Example Scenario
Borrower Profile | Property Type | DSCR | Loan Term | Approx. Rate |
740 FICO | Single-family rental | 1.25 | 30-year fixed | ~7.00% |
700 FICO | Duplex | 1.10 | 7/6 ARM | ~8.00% |
680 FICO | Airbnb rental | 1.05 | 30-year IO | ~8.75% |
This is a tip.
Improving your DSCR (raising rent or lowering expenses) can instantly unlock better pricing tiers.
⚙️ How DSCR Loan Rates Compare to Conventional Loans
DSCR loans usually price 1%–2% higher than conventional investor loans due to reduced documentation and added flexibility.
However, they offer faster approvals, no income verification, and LLC ownership options, which can make the slightly higher rate well worth it.
💬 Summary
While DSCR loan rates can fluctuate, most investors find the tradeoff between ease of qualification and flexible underwriting more than offsets the marginally higher interest cost.
The key is optimizing your DSCR ratio, credit, and LTV to qualify for the best available terms.