An investment property loan costs more than a home loan for a reason you can read in black and white. Fannie Mae publishes the surcharges it adds to every rental loan it buys, down to the percentage point. This page lays out that table, works it through on a $300,000 rental, and shows which of your choices actually lower the price, then where DSCR and hard money rates fit around it.
Most loans on rental houses end up owned by Fannie Mae or Freddie Mac, and both charge lenders a fee for each risk a loan carries. The fees are called loan-level price adjustments. They are a percentage of the loan amount, published in a table anyone can read, and they stack.
A loan on a house you will rent out pays two of them. One is for your credit score and down payment, the same one a homeowner pays. The other applies only because it is an investment property, and it is the reason an investor's quote comes in above the rates in the news.
Lenders rarely show you these as a line item. They usually build them into the interest rate. But because the table is public, you can see exactly which choices move your price and by how much, which is more useful than any rate a website advertises.
These figures come from Fannie Mae's Loan-Level Price Adjustment Matrix dated September 9, 2026. On a purchase loan, the investment property adjustment by loan-to-value is:
60 percent or less: 1.125 percent of the loan. 60.01 to 70: 1.625 percent. 70.01 to 75: 2.125 percent. 75.01 to 80: 3.375 percent. Above 80: 4.125 percent.
Notice the step between 75 and 80. Moving from 25 percent down to 20 percent down raises the investment surcharge by 1.25 percent of the loan, the biggest jump anywhere in the table.
On top of that sits the credit-score adjustment every borrower pays. With a 760 score it is 0.25 percent at 75 percent loan-to-value and 0.625 percent at 80. With a score of 700 to 719 it is 0.875 percent and 1.375 percent. A two-to-four unit building adds 0.375 or 0.625 percent more.
Put the table to work on a single-family rental bought for $300,000 by a borrower with a 760 credit score.
25 percent down. A $225,000 loan at exactly 75 percent loan-to-value. Adjustments: 0.25 plus 2.125, or 2.375 percent, about $5,340.
20 percent down. A $240,000 loan at 80 percent. Adjustments: 0.625 plus 3.375, or 4.0 percent, about $9,600.
15 percent down. A $255,000 loan at 85 percent. Adjustments: 0.625 plus 4.125, or 4.75 percent, about $12,110, and mortgage insurance on top.
The same borrower buying the same house as a home, at 20 percent down, would pay only the 0.625 percent credit adjustment, about $1,500. The rental pays about $8,100 more for the same loan on the same house.
Drop the credit score to the 700 to 719 band and the three cases become 3.0, 4.75 and 5.625 percent: roughly $6,750, $11,400 and $14,340. On a rental, a stronger score and a bigger down payment are worth more than on a home, because they sit on top of a larger base charge.
One practical detail: the break is at exactly 75.00 percent. A loan at 75.01 percent prices as 80. If you are close, bring the extra few hundred dollars to land inside the lower band.
A cash-out refinance on an investment property pays the same investment surcharge plus a cash-out credit adjustment that is steeper than the purchase one. On Fannie Mae's current table, a borrower with a 740 score taking cash out at 75 percent loan-to-value pays 1.625 percent for the cash-out credit adjustment and 2.125 percent for the investment property, 3.75 percent in all. At 70 percent it falls to 2.625 percent. Cash-out on a rental also tops out at lower leverage than a purchase does.
That is worth knowing before you plan to pull equity out of one rental to buy the next. The equity is real; so is the cost of getting to it.
Freddie Mac's weekly survey put the average 30-year fixed rate at 6.95 percent on September 17, 2026, up from 6.76 percent a week earlier. That survey covers home purchases with 20 percent down and excellent credit. It is a useful starting line, but an investment property loan starts above it, and the adjustments above are most of the reason why.
Rates move every week. The adjustments do not. When you compare quotes, the parts you control are the ones in the table: your down payment band, your credit score band, and the number of units.
DSCR loans are not sold to Fannie Mae or Freddie Mac, so Fannie Mae's adjustment table does not apply to them. Each lender prices its own risk. Headline DSCR rates usually sit above conventional investment rates, but for a borrower with a middling score or putting 20 percent down, the gap can be smaller than it first looks once the conventional adjustments are counted. Our lending partners' DSCR program lists rates from 5.99 percent and origination points from 1.5 percent on its program page, on loans from $75,000 to $2 million at up to 80 percent of value. More on this in where DSCR rates sit now.
Hard money is a different product, priced for a short hold. Our lending partners' fix and flip and bridge loans are priced at 12.99 percent and 2.99 points as standard under their underwriting guidelines. The 10.99 percent starting rate is available after two loans have been paid off in good standing with our lending partner; a first-time borrower should expect to start above it and earn the way down. On a loan held for six months, the points often matter more than the rate.
All of our lending partners' programs are business-purpose loans on non-owner-occupied property, and pricing changes, so we confirm current terms for your deal.
On a conventional loan, Fannie Mae and Freddie Mac charge a loan-level price adjustment for investment property on top of the adjustment for your credit score and down payment. At 20 percent down, Fannie Mae's investment property adjustment is 3.375 percent of the loan amount. Lenders usually fold that cost into a higher rate rather than charging it at closing.
There is no single spread, because the cost depends on your down payment and credit score. As a fee, Fannie Mae's investment property adjustment ranges from 1.125 percent of the loan at very low leverage to 4.125 percent above 80 percent loan-to-value. How much of that shows up in your rate depends on the lender.
Yes, noticeably. On a Fannie Mae purchase loan with a 760 credit score, the combined adjustments fall from 4.0 percent of the loan at 20 percent down to 2.375 percent at 25 percent down. The break sits at exactly 75 percent loan-to-value, so 75.01 percent prices like 80.
Usually somewhat, because DSCR loans are not sold to Fannie Mae or Freddie Mac. But DSCR lenders do not use Fannie Mae's adjustment matrix, so for some borrowers, particularly at higher leverage or with lower scores, the gap is smaller than the headline rates suggest. Compare the full cost, points included.
Freddie Mac's weekly survey put the average 30-year fixed rate at 6.95 percent on September 17, 2026, but that survey tracks home purchases with 20 percent down and excellent credit, not rentals. An investment property loan will price above it by an amount set largely by the adjustments on this page.
Hard money is priced differently, as a short-term loan with origination points. Our lending partners' fix and flip and bridge loans are priced at 12.99 percent and 2.99 points as standard, with a 10.99 percent starting rate available after two loans have been paid off in good standing with our lending partner.
Weighing the rate against what the rental will earn? Our two free landlord books show what a rental costs to hold in twelve states.
Answer these and your deal goes to our lending partner's team, who will contact you about whether it is fundable and on what terms. By sending it you agree to your details being shared with them. Investment property only — our lending partners do not finance a home you will live in.
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Dominion Hard Money does not lend its own funds; it arranges financing through third-party lending partners. All financing is arranged for business purposes only and secured by non-owner-occupied investment property. Not a commitment to lend. All loans subject to underwriting, property review, and approval by the lender. Terms vary by property, borrower experience, and exit strategy.
What each lender requires · DSCR loan rates · Hard money rates · Ways to finance a rental · Cash-out refinancing