5/6, 7/6 and 10/6 structures
DSCR ARM Rates
A DSCR ARM can pair an initial fixed-rate period with later adjustments. The right structure depends on the expected hold period, exit plan, adjustment terms, property cash flow, points, and prepayment provisions.
Read what happens after the initial fixed period.
An ARM comparison needs more than the starting rate. Ask for the initial fixed period, the date of the first adjustment, the later adjustment frequency, the index, the margin, the rate floor and each applicable cap. Use the actual note terms rather than assuming two ARMs with similar labels work the same way.
Test whether the property can support a higher future payment. A plan to refinance or sell is not a guarantee that either option will be available on favorable terms. Compare a fixed-rate structure for the same scenario alongside the ARM, including costs and prepayment terms.
Understanding the ARM labels.
5/6 ARM
The initial rate is generally fixed for five years, followed by adjustments every six months.
7/6 ARM
The initial fixed period is generally seven years before six-month adjustment intervals.
10/6 ARM
The initial fixed period is generally ten years before six-month adjustment intervals.
Review more than the starting rate.
- Index and margin used after the fixed period.
- Initial, periodic, and lifetime adjustment caps.
- APR, points, lender credits, and prepayment structure.
- Expected sale, refinance, or hold period.
- Property cash-flow sensitivity if the rate adjusts upward.
ARM strategy is timeline-dependent.
An ARM can be useful when the planned hold period ends before or near the first adjustment, but plans can change. The Rate Desk comparison should include the fully indexed mechanics, caps, payment sensitivity, and alternative fixed structures.
Related DSCR rate guides.
Continue your rate research with the most relevant comparison pages.
Build a DSCR rate review around the actual property.
Share your property and financing goal. A NonQM123 specialist will review your request and contact you by phone or email with the next steps.
Business-Purpose Investment Financing
This website presents financing options intended for eligible non-owner-occupied investment properties and business purposes only. The subject property may not be occupied by the borrower or the borrower’s family when prohibited by the applicable program. Loan proceeds may not be used for personal, family, or household purposes. Program availability, occupancy requirements, terms, and eligibility are subject to underwriting, property review, state restrictions, and lender approval.