1st Security Bank DSCR Loan Review 2026: The FDIC Bank With No Published DSCR Rate Sheet

Why this review exists

CrowdfundedWealth has spent the last several months publishing forensic, primary-source reviews of every meaningful DSCR and business-purpose lender in the United States: Visio Lending, Kiavi, Lima One Capital, LendingOne, Roc360, Easy Street Capital, Velocity Financial, Constructive Loans, RCN Capital, and more. Inside that universe sits a distinct sub-cluster: depositories that are simultaneously FDIC-insured banks and DSCR investor lenders. Three were already reviewed — CFBank, Quontic Bank, and NASB.

In a May 2026 DataForSEO probe, the Google AI Overview generated for the query "fdic insured dscr lender" cited three institutions: NASB, CFBank, and 1st Security Bank. NASB and CFBank were already covered. 1st Security Bank was not. This article completes the FDIC-insured DSCR bank cluster.

The disambiguation problem comes first. Several US banks carry some version of the "1st Security Bank" or "First Security Bank" name — there is a First Security Bank in Missoula, Montana; a First Security Bank in Arkansas; a First Security Bank in Mississippi; and others. The institution Google's AI Overview cited, and the one that actually markets DSCR and non-QM loans, is 1st Security Bank of Washington in Mountlake Terrace, Washington — the operating subsidiary of NASDAQ-listed FS Bancorp, Inc. This review is about that legal entity and no other. Every fact below is verified against that bank's own website (fsbwa.com), the FDIC BankFind database, NMLS Consumer Access, and FS Bancorp's SEC filings.

The honest finding, stated up front: this bank's DSCR "product" is far less defined than CFBank's or NASB's. That is not a reason to skip the review — it is the most important thing a prospective borrower needs to know before they spend an afternoon on the phone.

The entity: 1st Security Bank of Washington, in full

To avoid any confusion, here is the precise legal identification of the institution under review:

• Legal name: 1st Security Bank of Washington
• FDIC Certificate #: 57633 (verified, FDIC BankFind)
• Charter type: State-chartered savings institution (FDIC bank class "SI")
• Primary federal regulator: Federal Deposit Insurance Corporation (FDIC); state regulator is the Washington State Department of Financial Institutions, Division of Banks
• Headquarters: 6920 220th Street SW, Mountlake Terrace, Washington
• NMLS #: 761985 (verified on fsbwa.com and NMLS Consumer Access)
• FDIC routing number: 325182289
• Date insured / charter established: April 1, 2004 (per FDIC BankFind)
• Holding company: FS Bancorp, Inc. (NASDAQ: FSBW; SEC EDGAR CIK 1530249; incorporated in Washington)
• Number of offices: 31 (per FDIC BankFind, December 31, 2025) — described by the bank as 27 neighborhood branches plus 8 home lending offices

The "since 1907" branding on fsbwa.com refers to the institution's lineage: its predecessor began as a credit union serving Washington customers in 1907. The credit union converted to a mutual savings bank in 2004 — which is why the FDIC's "established" and "insured" dates both read April 1, 2004. In 2012, FS Bancorp completed an initial public offering and the bank became the subsidiary of a publicly traded stock holding company. So while the brand heritage is genuinely old, the FDIC-insured charter is just over two decades old, and the public-company structure dates to 2012. Investors evaluating "is this a stable, long-tenured institution" should weigh both facts honestly: long brand history, but a relatively young bank charter and a 14-year-old public company.

Corporate structure and history

FS Bancorp, Inc. is the sole-bank holding company for 1st Security Bank of Washington. It completed its IPO in 2012 and trades on the NASDAQ under ticker FSBW. The holding company is regulated by the Federal Reserve; the bank is regulated by the FDIC and the Washington Division of Banks.

FS Bancorp has grown materially through acquisition. The most significant deal was the 2018 merger with Anchor Bancorp and its Anchor Bank subsidiary: FS Bancorp paid aggregate consideration of 725,585 FS Bancorp shares plus $30.8 million in cash, adding nine Anchor branches and a loan production office. Following that merger the combined company operated 21 branch offices and nine loan production offices, and it has continued to add locations since.

The most recent corporate development — and one most aggregator profiles have not yet caught up to — is the pending merger with Pacific West Bancorp. FS Bancorp and Pacific West Bancorp signed a definitive merger agreement on February 25, 2026, in a stock-and-cash transaction valued at approximately $34.6 million (430,176 FS Bancorp shares plus $16,832,742 in cash). Pacific West Bank operates four branches in the Greater Portland metro area (Portland, Vancouver, West Linn, Lake Oswego). The deal had not closed as of this review's publication date — closing is expected in the third quarter of 2026, subject to Pacific West shareholder and regulatory approval. On a pro forma basis the combined company would have roughly $3.6 billion in assets, $3.0B in loans, $3.0B in deposits, and 31 branches across the Pacific Northwest. For a DSCR borrower this matters because it signals FS Bancorp is in an active expansion phase concentrated in the Portland/Vancouver corridor — an area where investment-property lending demand is strong.

The bank's Home Lending division is the unit that originates mortgages, including investment-property and non-QM/DSCR loans. It markets a "Buyer Advantage Program" offering up to a 1% lender credit, and originates conventional purchase, refinance, HELOC, HECM (reverse mortgage), custom construction, and manufactured-home loans alongside investor products.

Regulatory standing — honest disclosure

Here is the verified regulatory record for 1st Security Bank of Washington, presented in full because honesty about enforcement history is the entire point of these reviews.

Open enforcement orders as of May 2026: none found. A review of FDIC enforcement action records turned up no open or pending order against the bank.

Historic actions — all resolved, all old:

1. FDIC consent cease-and-desist order, August 10, 2007 — required the institution to improve its Bank Secrecy Act / anti-money-laundering compliance policies and procedures. This is a compliance-program order, not a safety-and-soundness or capital order. It pre-dates the bank's 2012 IPO.
2. FDIC civil money penalty, August 20, 2008 — a $4,235 penalty assessed for past deficiencies in compliance with the National Flood Insurance Act and Flood Disaster Protection Act. The board consented and paid the penalty. The dollar figure is trivial and the matter is closed.
3. Earlier, a Washington Department of Financial Institutions "Notice to Correct" issued February 21, 2006 was terminated in August 2007, and an FDIC memorandum of understanding from January 10, 2006 was terminated in May 2008.

Every one of these items is more than 17 years old and fully resolved. None involves capital adequacy, fraud, or consumer harm of the kind that should worry a 2026 borrower. The honest read: 1st Security Bank had ordinary BSA/AML and flood-compliance growing pains in the mid-2000s as a small institution, cleaned them up, went public in 2012, and has kept a clean federal enforcement record for well over a decade since.

This puts 1st Security Bank in a regulatory tier comparable to CFBank (no open OCC orders since 2014) and NASB (terminated 2012 OCC consent order) — and materially cleaner than Quontic Bank, which carries three open OCC and Federal Reserve enforcement orders.

One BBB note for completeness: 1st Security Bank's Better Business Bureau profile shows a small number of complaints (the BBB cites a failure to respond to 4 complaints, which can depress a BBB letter grade). The complaint volume is low for a bank of this size, but a prospective borrower should read the current BBB profile directly before committing.

The DSCR product — what 1st Security Bank actually publishes

This is the section that matters most, and it requires blunt honesty.

1st Security Bank does not publish a DSCR loan product specification. There is no DSCR product page on fsbwa.com with a terms grid. What exists are two educational articles in the bank's news-and-events section:

1. "Understanding DSCR and Non-QM Loans"
2. "The Small Real Estate Investor Advantage"

Both articles explain, in general industry terms, what a DSCR loan is — that it underwrites the property's rental income rather than the borrower's personal income, that a DSCR above 1.0 indicates positive cash flow, that the product suits self-employed borrowers and portfolio investors. Both articles end the same way: "Connect with a 1st Security Bank loan officer for a no obligation consultation." Neither article discloses a single hard term.

Specifically, as of this review, 1st Security Bank does not publicly disclose any of the following for its DSCR/investor lending:

• Minimum DSCR ratio — not published; obtainable only by phone
• Minimum FICO / credit score — not published
• Maximum LTV (purchase, rate-term, or cash-out) — not published
• Maximum loan amount — not published
• Interest-only option availability — not published
• Short-term rental (Airbnb/VRBO) eligibility — not published
• Whether LLC/entity borrowers are accepted — not published
• Rates and points — no rate sheet published anywhere on the bank's site

What is verifiable: the bank's Home Lending division does lend on investment properties, and the bank's marketing explicitly uses the terms "DSCR" and "Non-QM." The states served are confirmed: Washington, Oregon, Idaho, Montana, Arizona, Colorado, Nevada, and California — eight Western states, verified on fsbwa.com/home-lending. The customer line for the lending team is (800) 683-0973.

The most likely explanation, given the bank's structure, is that 1st Security Bank originates investor and non-QM loans either as portfolio loans underwritten case-by-case, or as broker/correspondent loans placed with a non-QM investor — with terms set per deal rather than from a fixed published matrix. That is a defensible business model for a community bank. But it means a borrower cannot comparison-shop 1st Security Bank against a published competitor grid without first spending time on the phone, and it means this review cannot honestly assert a DSCR floor or FICO minimum. We will not invent numbers. If you need those numbers, the only reliable source is a direct conversation with the bank's lending team.

DSCR specs head-to-head: the FDIC-insured four

Because 1st Security Bank publishes no DSCR specs, the only honest comparison table is one that shows that gap explicitly against the three banks that do publish terms.

The honest takeaway from that table: on the two dimensions where 1st Security Bank can be compared — geographic footprint and enforcement record — it lands mid-pack. Its eight-state footprint is the narrowest of the four. Its clean enforcement record ties it with CFBank and NASB and beats Quontic. On every product-term row, the only accurate entry is "not published."

Financial health — FS Bancorp by the numbers

Where 1st Security Bank is opaque on lending terms, it is transparent on financials, because its parent FS Bancorp is a public SEC filer. This is genuinely useful for a DSCR borrower: a lender that might hold your loan on its balance sheet should itself be financially sound.

The picture is solid. FS Bancorp reported Q1 2026 net income of $7.8 million, or $1.02 per diluted share — a modest beat of consensus, with pre-tax income of $9.9 million up 4.6% from Q1 2025. Total assets reached $3.20 billion. Net interest margin held at 4.31%, down just one basis point year over year — a healthy margin that reflects the bank's community-bank deposit base. Book value per share climbed to a record $42.42.

Capital is comfortably above regulatory minimums: at March 31, 2026 the bank's total risk-based capital ratio was 13.8% and its Tier 1 leverage ratio was 11.2%, and the bank is classified "well capitalized" — the highest of the FDIC's five capital categories. The holding company's consolidated CET1 ratio was 12.59% and total risk-based capital 13.81% at quarter-end, with year-end 2025 figures even stronger (CET1 14.12%, total RBC 15.73%).

One honest caution: Q1 2026 credit costs rose. FS Bancorp booked a $2.6 million loan-loss provision versus $1.5 million a year earlier — a sign management is reserving more aggressively against a softer credit environment. That is prudent, not alarming, but it is worth noting that the bank is provisioning more heavily heading into mid-2026.

On the equity side, FSBW traded around $40 per share in mid-April 2026, with a market capitalization near $297 million, a dividend yield of about 2.84% ($1.16 annualized), and the company has now paid 53 consecutive quarterly dividends. The single analyst publishing a rating had a "Buy" with a 12-month price target near $44. None of this is investment advice — a DSCR borrower simply benefits from knowing the lender's parent is profitable, dividend-consistent, and not under financial stress.

Rates and fees

There is nothing to report here, and that itself is the finding. 1st Security Bank publishes no rate sheet for DSCR or non-QM investor loans, and no points/fees schedule. The bank's general mortgage marketing references a "Buyer Advantage Program" lender credit of up to 1%, but whether that applies to investor/DSCR loans is not stated. Pricing is available only by contacting a loan officer at (800) 683-0973. Treat any DSCR rate you see attributed to "1st Security Bank" on a third-party aggregator as unverified until the bank confirms it in writing.

Who 1st Security Bank is for — and who should look elsewhere

It may fit you if: you are a real estate investor located in one of the eight Western states the bank serves (WA, OR, ID, MT, AZ, CO, NV, CA); you value a relationship with a balance-sheet community bank over a transactional online lender; you may already bank with 1st Security Bank and want to consolidate; you have a property or deal structure that does not fit a rigid published matrix and would benefit from case-by-case portfolio underwriting; and you are comfortable picking up the phone to learn terms.

Look elsewhere if: you operate outside those eight states (the bank simply cannot lend to you); you want to compare published DSCR terms side by side before investing time; you need a rate lock you can see online; you want a low published DSCR floor for a thin-cash-flow property (CFBank's published 0.75 is the benchmark — see the CFBank review); or you want a mature investor support ecosystem with broker mystery-shopping data and forum reviews. For pure DSCR-product transparency, the dedicated non-QM lenders — Visio Lending, Kiavi, Lima One Capital — and the FDIC-insured CFBank all publish more than 1st Security Bank does.

Aggregator errors and stale claims, corrected

Reviewing third-party coverage of 1st Security Bank surfaced several recurring errors and gaps worth correcting with sources:

1. Stale and conflicting total-asset figures. Multiple aggregator profiles still cite asset figures ranging from "$2.92 billion" to "$1.04 billion (as of March 31, 2018)." The correct, current figure is $3.196 billion per FDIC BankFind as of December 31, 2025, and $3.20 billion per FS Bancorp's Q1 2026 earnings release. The 2018 figure is seven years out of date.

2. The "1936" founding date. At least one profile lists 1st Security Bank as "founded in 1936." The bank's own materials say it has served customers since 1907, and the FDIC charter dates to April 1, 2004. "1936" appears nowhere in primary sources and should be disregarded.

3. Implying a defined, published DSCR product. Several lead-generation and aggregator pages present 1st Security Bank as if it has a packaged DSCR loan with standard terms. As documented above, the bank publishes only educational articles — no DSCR ratio, FICO, LTV, or loan-amount specification exists publicly. Any aggregator page quoting specific 1st Security Bank DSCR terms is presenting unverified data.

4. Conflating "1st Security Bank" entities. Search results routinely mix 1st Security Bank of Washington with the unrelated First Security Bank institutions in Montana, Arkansas, and Mississippi. Only the Washington bank (FDIC Cert #57633, parent FS Bancorp) is the institution Google's AI Overview cited as an FDIC-insured DSCR lender. Reviews that do not name the FDIC certificate or holding company are not reliably about the right bank.

5. Outdated branch and footprint counts. Pre-2024 profiles cite branch counts and footprints from before recent expansion. The current count is 31 offices (FDIC BankFind, 12/31/2025), and the Pacific West Bancorp merger announced February 2026 — adding the Portland metro — is missing from nearly every aggregator profile.

6. The Q1 2025 vs Q1 2026 net income mix-up. Some pages cite "$8.0 million / $1.01 per diluted share" — those are FS Bancorp's Q1 2025 figures. The current quarter (Q1 2026) is $7.8 million / $1.02 per diluted share. The figures are close, but a borrower checking current financial health should use the Q1 2026 numbers.

An under-reported fact worth flagging: FS Bancorp's net interest margin of 4.31% is strong for a community bank this size, and the company has now paid 53 consecutive quarterly dividends — a continuity record that few aggregator profiles mention but that speaks directly to the institution's stability as a potential balance-sheet lender.

Frequently asked questions

Bottom line

1st Security Bank of Washington is a real, FDIC-insured, well-capitalized $3.2 billion savings bank with a clean recent regulatory record and a profitable, dividend-consistent public parent in FS Bancorp. It does originate investment-property and non-QM/DSCR-style loans. None of that is in doubt.

What is in doubt is whether you can call its investor lending a "DSCR product" in the way CFBank, Visio, or Kiavi offer one. It is not packaged, not speced, and not priced publicly. For an investor inside its eight Western states who wants a community-bank relationship and is willing to work the phone, it is a legitimate option worth a conversation. For everyone else — investors outside the West, or anyone who wants to compare published terms before committing time — a transparent national lender is the better first call.

Before you pick a DSCR lender, run your property's numbers with the DSCR loan calculator, review the field in the best DSCR loan lenders of 2026, and read the CFBank DSCR review — the FDIC-insured bank that publishes the transparent product 1st Security Bank does not. For the fifth FDIC-insured option in the cluster, see the Farm Bureau Bank DSCR review — the loan is originated through a loanDepot joint venture rather than balance-sheet underwritten, a structural fact most aggregator profiles omit. If you are still deciding between a DSCR loan and a conventional investment-property mortgage, see DSCR loan vs conventional mortgage; if you already hold a DSCR loan, how to refinance a DSCR loan in 2026 walks through the seasoning and prepayment-penalty math. Fair rating for 1st Security Bank: 3.4 of 5 — a sound institution with an opaque product.