2026 Prepayment Penalty Updates for DSCR Loans

2026 Prepayment Penalty Updates For DSCR Loans

Two states contain prepayment penalty restrictions on DSCR Loans that rely on a dollar-amount threshold that is updated annually based on inflation. While these annual updates only affect two states, Ohio and Pennsylvania, these states are important for real estate investors and mortgage industry professionals alike due to their robust populations and rental property investment opportunities. Thus, its important for well informed market participants to be aware of these updates and avoid surprises in the DSCR Loan mortgage process.

And of course, Prepayment Penalties are a crucial aspect of DSCR Loans, for check out our: comprehensive 50-State guide (+DC) to prepayment penalty rules!

Harpoon Capital header image titled 'Prepayment Penalty Rules 2026 Update for Ohio,' featuring a gold map of Ohio and introducing the guide section on state-specific DSCR loan regulations

Prepayment Penalty Rules 2026 Update for Ohio

In the state of Ohio, one-unit (SFR) and two-unit (duplex) properties secured by DSCR Loans with a balance under the annual threshold are limited to maximum fee of 1% and a maximum duration of five years. For 2026, the threshold has been increased to $116,356. This is increased from $112,957 in 2025, an approximately 3% increase. For rental properties with three units or more, and for DSCR Loans securing one- or two-unit properties with balances over the new threshold, there should generally be no additional prepayment restrictions from a DSCR Lender's general options.

Harpoon Capital header image titled 'Prepayment Penalty Rules 2026 Update for Pennsylvania,' featuring a gold map of Pennsylvania and introducing the guide section on state-specific DSCR loan regulations

Prepayment Penalty Rules 2026 Update for Pennsylvania

In the state (or technically, commonwealth) of Pennsylvania, one-unit (SFR) and two-unit (duplex) properties secured by DSCR Loans with a balance under the annual threshold are completely restricted from having prepayment penalties applied. For 2026, the threshold has been increased to $329,411. This is increased from $319,777 in 2025, an 3.01% increase. For rental properties with three units or more, and for DSCR Loans securing one- or two-unit properties with balances over the new threshold, there should generally be no additional prepayment restrictions from a DSCR Lender's general options.

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