Should I be able to get better than 7.8% for 30 year fixed?

Question

Hello all,

I am ready to jump on deal No. 2.

I have a property I like. It would be a traditional long term lease property. 3 bed, 2 bath, single car garage.

I was estimating 7% on a 30 year fixed rate, non-owner occupied loan.

However, the preapproval came back at 7.8%, which makes this deal not as attractive.

Should I keep looking for financing at 7% or are the upper 7s the going rate right now?

Thanks!

-Felix

James Jones · Answer

7.8% is not abnormal right now for a 30-year fixed, non-owner-occupied loan. Upper 7s are very common in the current market.

A few important clarifications that matter more than the headline rate:

Investment loans price higher than primary homes

Non-owner-occupied 30-year fixed loans typically run 75–125 bps higher than owner-occupied. If primary rates are mid-6s to low-7s, high-7s on an investment loan is within range.

7% flat usually requires tradeoffs

Getting closer to 7% often means:

Buying points

Stronger DSCR or lower LTV

Excellent credit plus reserves

Portfolio lenders or relationship pricing

Those options exist, but they aren’t “default” quotes.

The rate alone shouldn’t kill the deal

If the deal only works at 7.0% but fails at 7.8%, it’s thin. In this environment, deals need margin for rate volatility. Many investors are underwriting at 8–8.25% to stay conservative.

You may be looking at the wrong product

Depending on the property and your profile, you may want to compare:

DSCR loans

5/7 or 7/1 ARMs with refinance plans

Portfolio lenders with relationship discounts

Not necessarily cheaper today, but more flexible long term.

Refinancing is part of the plan

Most investors closing right now are assuming a future refinance, not a permanent rate. The question becomes:

Does the deal survive today and improve later?

Bottom line:

Yes, you can sometimes find 7-handle rates, but upper 7s are the going rate for vanilla 30-year fixed investment loans. If that rate breaks the deal, either the price needs to move or it’s not a deal worth forcing.

The market rewards patience and margin right now, not optimism.

Elias Halvorson · Answer

Felix, Im only licensed in HI and WA so not trying to sell you anything, but I estimated a 300K purchase price, 20% down, 780 credit for an investment property on a SFH and I see one lender offering about 6.7%, no points. I would definitely shop that rate with some mortgage brokers in your area.

Felix Sharpe · Answer

@Jake Andronico 20% down. Don't really want to buy points.

Nicholas L. · Answer

@Felix Sharpe

mid to upper 7s are what I am seeing for DSCR.  can get lower with conventional probably with a buy-down.

every lender talks a big game until you tell them it's an investment property :-)

Bo Smith · Answer

7.8% isn't terrible for non-owner occupied right now, but you can definitely shop around. Credit unions and portfolio lenders often beat the big banks by 0.25-0.5%. Also check if you qualify for relationship discounts - some lenders drop rates if you bring multiple accounts over. What's your credit score and down payment percentage? Those two factors make the biggest difference in rate shopping.

Jacob Thorpe · Answer

Is this a DSCR purchase? I just wrote a conv. rate and term refi for 5.99. I am registering a portfolio bridge 75% cash out at 6.78% no seasoning on title now. I think I can get DSCR no prepayment penalty for around 6.5% without buydown 30yr fixed, 80-85% LTV, would have to check the matrix. That rate seems high without seeing anything about the deal, loan type your talking about or knowing how youre qualifying

Raymond J. Rodrigues · Answer

@Felix Sharpe I'm seeing rates in the low to mid 6s depending on your credit score. Feel free to reach out and I'd be happy to share my lending sources.

Devin Peterson · Answer

Shop it out theres always something more competitive out there. I would also maybe enteratin and interest only option that would help squeeze some more juice out of the fruit.

Matthew Thornton · Answer

I believe my Investors are getting DSCR's right now in the high 6's

Greg Ochotorena · Answer

In NJ, pricing differences often come down to structure and product, not just the rate environment.

With business-purpose DSCR loans, vesting in an LLC removes certain consumer-loan constraints and opens up additional pricing and product options when structured correctly.

That is why DSCR can sometimes price better than expected. Structure matters.

Should I be able to get better than 7.8% for 30 year fixed?

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