DSCR Direct

DSCR loan pricing is not as simple as "today's rate is 6.5%." Every borrower gets a different rate based on their specific combination of FICO score, LTV, DSCR ratio, loan amount, property type, prepayment penalty, and other factors. These adjustments are laid out on lender rate sheets - internal pricing documents that map every scenario to a specific rate and price. Understanding how rate sheets work helps you optimize your loan terms and avoid overpaying.

What Is a Rate Sheet?

A rate sheet is the pricing document a lender publishes (usually daily) that shows the available interest rates and corresponding prices for each loan scenario. It is essentially a matrix: rows represent different interest rates, columns represent different lock periods, and the body contains the price (expressed in points) at each rate/lock combination. Before you get to that matrix, however, a series of adjustments modify the base price based on your loan characteristics.

LTV Adjustments

Loan-to-value ratio is one of the biggest pricing factors on a DSCR rate sheet. Lower LTV means less risk for the lender and better pricing for you. A typical rate sheet might show: 60% LTV gets a +0.50 point credit, 70% LTV is par (no adjustment), 75% LTV gets a -0.25 point hit, and 80-85% LTV gets a -0.75 to -1.50 point hit. These adjustments can translate to 0.25-0.75% in rate difference. Putting 25% down instead of 15% can meaningfully reduce your rate.

FICO Score Tiers

DSCR rate sheets break FICO scores into tiers, typically: 760+, 740-759, 720-739, 700-719, 680-699, 660-679, and 600-659. The difference between the top and bottom tier can be 1.0-2.0 points in price, which translates to roughly 0.50-1.00% in rate. Each tier has its own adjustment applied to the base price. If your FICO is near a tier boundary (say 738), even a small improvement to 740 can meaningfully improve your pricing.

DSCR Ratio Adjustments

The DSCR ratio itself affects pricing. Rate sheets typically show tiers like: 1.25+ DSCR (best pricing), 1.00-1.24 (small hit), 0.75-0.99 (moderate hit), and below 0.75 (largest hit, if available). A property with a 1.30 DSCR will price better than the same property at 0.90 DSCR, even if everything else is identical. This is why maximizing rental income and minimizing the payment (through lower taxes, cheaper insurance, or a larger down payment) can improve your rate in multiple ways simultaneously.

What Is Par Pricing?

Par pricing means the loan has a price of 100.00 - no discount points and no lender credit. When the rate sheet shows a price above 100 (say 100.50), the lender pays you a 0.50 point rebate at closing. When the price is below 100 (say 99.25), you pay 0.75 points to get that rate. Investors often target par pricing as the sweet spot: you are not paying points out of pocket, and you are not taking a higher rate just to get a rebate. However, paying points can make sense if you plan to hold the property long-term, and taking a rebate can make sense if you want to minimize closing costs.

Loan-Level Price Adjustments (LLPAs)

LLPAs are the specific point adjustments applied to your base price for each risk factor. A single loan might have five or more LLPAs stacked: FICO tier adjustment, LTV adjustment, DSCR ratio adjustment, property type adjustment (condos and multifamily often have hits), and loan amount adjustment (very small or very large loans can price differently). All of these adjustments are additive. Understanding which LLPAs apply to your scenario tells you which levers you can pull to improve your rate.

How DSCR Direct Optimizes Your Rate

Every lender has a different rate sheet with different base rates, different adjustments, and different tier breakpoints. What prices poorly at one lender might be a sweet spot for another. DSCR Direct runs your exact scenario against rate sheets from hundreds of lenders simultaneously and shows you the lowest available rate. This is particularly valuable because a 0.25% rate difference on a $300K loan saves about $50/month or $18,000 over 30 years. Try it at dscrdirect.net - enter your scenario and see your best pricing in seconds.