DSCR Rates Update — May 2026

The week of May 21, 2026 finds DSCR loan rates in a stable but wider band than earlier in the quarter: 6.25%–7.875% across credit tiers, with top-tier 720 FICO / 75% LTV / 1.10 DSCR quotes clustering in the 6.75%–7.25% range on a 30-year fixed. That band has shifted slightly upward from the April lows, driven primarily by the recent rise in the 10-year Treasury yield to 4.65%.

Where rates are right now

Our blended median for the week of May 21, 2026:

Product	720 FICO / 75% LTV / 1.10 DSCR
30-yr fixed	7.00%
5/1 ARM	6.625%
7/1 ARM	6.75%
10-yr IO / 30-yr term	7.25%

These are note rates, not APR, and assume a 1-point buydown baked in on a clean LLC-vested scenario. Individual lender quotes will vary ±0.25%.

What’s driving the current level

10-year Treasury: The 10-year UST closed at 4.65% on May 20 (touching an intraday high of 4.70% — a 16-month high). Non-QM DSCR spreads to the 10-year have compressed to roughly 200–240 bps, down from 280–320 bps at the 2024 peak. That spread compression is the single biggest driver of where DSCR rates are today, buffering some of the impact of the Treasury selloff. For reference, Freddie Mac’s 30-year fixed owner-occupied benchmark averaged 6.36% for the week ending May 14, 2026 — DSCR loans typically price 25–100 bps above that depending on profile.

Non-agency MBS investor appetite: Institutional demand for non-QM mortgage-backed securities has been robust in Q1 and early Q2 2026. Several aggregators reported oversubscribed non-QM shelves, which flows through as favorable lender pricing to borrowers.

DSCR ratio mix shift: More borrowers are in the 1.10–1.25 DSCR range than at the 2022–2023 peak, when aggressive purchase prices pushed many deals below 1.0. The improved average credit quality of the DSCR pool reduces lender risk pricing.

What hasn’t changed: the LLPA stack

Even as absolute rates have come down, the loan-level price adjustment (LLPA) structure is intact. The pricing penalty for:

• Sub-680 FICO remains steep — expect +0.375% to +0.625% vs. a 720 FICO baseline
• 80% LTV vs. 75% LTV still adds 0.125%–0.25% at most lenders
• No-ratio programs carry an additional +0.25%–0.50% in most pricing grids
• Non-warrantable condos and STRs continue to see 0.25%–0.50% premiums

If you’re looking at published rate tables and your deal has multiple overlays (low FICO + high LTV + STR + non-warrantable), the actual quote will be materially higher than the headline.

What to watch through mid-year

Inflation readings: The May CPI print will continue to be a major rate-direction signal. A hotter-than-expected reading could push the 10-year back toward 5.00%, which would translate to DSCR rates re-testing the 7.50%–7.75% floor for clean deals.

Non-QM aggregator capacity: Watch for any announcements from major non-QM shelf operators about deal flow. If origination volume accelerates significantly through Q2, spreads could compress further, potentially pushing 30-year DSCR rates back into the 6.50%–6.75% range for top-tier profiles.

Fed signaling: The FOMC target range sits at 3.50%–3.75% after the measured cuts delivered through late 2025 and early 2026, and is now in a holding pattern. DSCR rates (like most non-QM products) track the 10-year UST rather than Fed Funds, so the near-term rate outlook for DSCR borrowers is driven more by Treasury auction demand than Fed rate decisions.

Our take

For investors who have been waiting for a better entry point: the window remains reasonably active, but volatility in the 10-year Treasury means locking rather than floating is the safer bet on active deals. Easing MBS spreads are helping offset treasury increases, making the current pricing relative to Treasuries quite favorable.

For borrowers with rate-and-term refis in pipeline: run the break-even analysis carefully. On a loan with a 5-year step-down prepay already attached, the math of refinancing to save 0.50% may not pencil until year 4 or 5 of the new loan — factor that into the decision.

Use our DSCR rates page for the full credit-tier and LTV grid, updated every Monday. To get a real, lockable quote on your specific deal, get matched with the top 3 lenders in our network.