Investment Property Mortgage Rates 2026: Current Rates & How to Get the Lowest
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Investment property rates average 6.60% for 30-year fixed in Feb 2026 — that's 0.50% above primary residence rates. With 760+ credit and 25% down, you can get as low as 6.10%. The rate spread between lenders is wider for investment properties (up to 1.0%), so shopping is critical. Compare investment property rates →
Current Investment Property Rates (February 2026)
| Loan Type | Investment Property | Primary Residence | Rate Premium |
|---|---|---|---|
| 30-Year Fixed | 6.60% | 6.10% | +0.50% |
| 15-Year Fixed | 5.95% | 5.50% | +0.45% |
| 5/1 ARM | 6.25% | 5.75% | +0.50% |
| 7/1 ARM | 6.35% | 5.85% | +0.50% |
| DSCR (no income docs) | 6.50-8.00% | N/A | Investment only |
Rates for 740+ credit, 25% down, $350K purchase. DSCR rates depend on DSCR ratio and credit. Rates as of Feb 13, 2026.
Investment Property Rates by Credit Score
| Credit Score | Rate (25% Down) | Rate (20% Down) | Rate (15% Down) | Monthly on $280K |
|---|---|---|---|---|
| 760+ | 6.10% | 6.35% | 6.60% | $1,700 |
| 740-759 | 6.25% | 6.50% | 6.75% | $1,725 |
| 720-739 | 6.50% | 6.75% | 7.00% | $1,770 |
| 700-719 | 6.75% | 7.00% | 7.25% | $1,816 |
| 680-699 | 7.00% | 7.25% | 7.50% | $1,863 |
| 660-679 | 7.50% | 7.75% | 8.00% | $1,958 |
The difference between 660 and 760 credit = $258/month or $92,880 over 30 years on a $280K loan.
5 Strategies to Get the Lowest Rate
1. House Hack a 2-4 Unit Property
Buy a duplex, triplex, or fourplex, live in one unit, rent the others. You get primary residence rates (6.10% vs 6.60%) AND can use FHA with just 3.5% down. The rental income from other units covers most/all of your mortgage. This is the #1 wealth-building strategy for new investors.
FHA Calculator →2. Put 25%+ Down
The biggest rate surcharge comes from LTV. Going from 80% to 75% LTV (20% to 25% down) typically saves 0.25-0.375% in rate — that's $70-$105/month on a $350K property.
3. Use a 15-Year Term
15-year investment property rates are 5.95% vs 6.60% for 30-year — a 0.65% discount. Higher monthly payment but you build equity 3x faster and pay 60% less interest over the loan life.
4. Shop Credit Unions
Credit unions often portfolio investment property loans (keep them in-house) and can offer rates 0.25-0.50% below big banks. PenFed, Alliant, and Navy Federal are top picks for investor loans.
5. Consider DSCR for Scaling
If you have 10+ financed properties or complex tax returns, DSCR loans qualify you on rental income alone — no W-2s needed. Rates start at 6.50% with no limit on properties.
DSCR Loan Guide →🏘️ Compare Investment Property Rates
Rate spreads are wider on investment properties. Shopping saves $200-$400/month.
Cash Flow Analysis: Will Your Rental Be Profitable?
Example: $350K single-family rental, 25% down ($87,500), 6.25% rate, 30-year fixed
Multi-Unit Property Analysis: 2-4 Units
| Property Type | Rate Premium | Down Payment | Typical Rent | Cash Flow (25% down) | Cap Rate |
|---|---|---|---|---|---|
| Single-Family Rental | +0.50-0.75% | 15-25% | $1,200-$2,500 | $200-$600/mo | 5-7% |
| Duplex | +0.50-0.75% | 15-25% | $2,000-$4,000 | $400-$1,000/mo | 6-8% |
| Triplex | +0.75-1.00% | 20-25% | $3,000-$5,500 | $600-$1,400/mo | 7-9% |
| Fourplex | +0.75-1.00% | 20-25% | $4,000-$7,000 | $800-$2,000/mo | 8-10% |
House-hack strategy: Buy a 2-4 unit with an owner-occupied loan (3.5% FHA or 5% conventional), live in one unit, rent out the rest. Your tenants pay most or all of your mortgage. After 1 year, move out and keep it as a full investment property with the original low rate.
1031 Exchange: Defer Taxes When Selling
A 1031 exchange lets you sell an investment property and defer ALL capital gains taxes by reinvesting in a "like-kind" property. This is the #1 wealth-building tool for real estate investors.
Example: Sell a $300K rental with $100K in gains. Without 1031: pay $23,800 in taxes (15% LTCG + 3.8% NIIT). With 1031: pay $0 and reinvest the full $300K into a larger property. Over a career of 5-10 exchanges, this can save $200K+ in taxes.
Investment Property Tax Write-Offs
| Deduction | Annual Value ($300K Property) | How It Works |
|---|---|---|
| Mortgage Interest | $14,000-$16,000 | 100% deductible against rental income |
| Depreciation | $8,727 | Building value ÷ 27.5 years (phantom deduction) |
| Property Taxes | $3,000-$5,000 | Fully deductible (no SALT cap for rentals) |
| Insurance | $1,200-$2,400 | Landlord policy premium |
| Repairs & Maintenance | $1,500-$3,000 | Immediately deductible (not improvements) |
| Property Management | $1,800-$3,600 | 8-12% of rent if using a PM |
| Travel to Property | $500-$1,500 | Mileage at $0.67/mile + expenses |
| Total Annual Deductions | $30,727-$40,227 | Often exceeds rental income = $0 tax |
Real Cash Flow: 3 Investment Scenarios
Scenario A: SFR in Texas
Scenario B: Duplex in Ohio
Scenario C: Fourplex in Indiana
Investment Property Rate Forecast 2026-2027
Now (Feb 2026)
6.60%
+0.50% vs primary
H2 2026 (Projected)
6.25-6.40%
Fed cuts expected
2027 (Projected)
5.90-6.15%
Best rates in 3 years
Strategy: Buy now at 6.60%, build equity and cash flow, then refinance in 2027 when rates drop to 5.90-6.15%. Your cash flow improves by $100-$200/month with each 0.50% rate reduction. Don't wait for lower rates — find good deals now and refinance later.
Related Investor Resources
Editorial Note: Rates from Freddie Mac PMMS and lender surveys. Updated Feb 13, 2026. This is not investment advice. Editorial standards.