Baltimore investors work mostly in rowhouses: buy, gut, rent and refinance. The refinance is where city rules show up, from rental licenses to lead certificates to the water bill, and each one has to be clean before the new loan closes.
In short: LendingStreet refinances Baltimore rentals out of hard money, bridge and existing loans with 30-year DSCR loans that qualify on the property's rent. Loans start at $150,000, rate-and-term reaches 80% LTV on some programs and the standard minimum DSCR is 1.0x. In Baltimore City, plan on a current rental license, Maryland lead registration for pre-1978 units, a clear water account and a property tax rate that is high compared with the surrounding counties.
Rowhouses dominate the city. Canton, Federal Hill, Highlandtown, Patterson Park, Hampden and Remington have renovated homes that rent to young professionals, while Hamilton, Lauraville, Belair-Edison, Pigtown and Morrell Park offer lower prices and strong rent-to-price ratios.
In Baltimore County, Dundalk, Essex, Parkville, Catonsville and Towson have single-family homes and duplexes that rent to families and workers at the port, hospitals and universities. Johns Hopkins and the University of Maryland medical systems are major sources of rental demand.
Anne Arundel and Howard counties add higher-value single-family rentals for workers at Fort Meade and BWI airport.
| Area | Typical rental stock | What to check before you refinance |
|---|---|---|
| Canton, Federal Hill, Hampden | Renovated rowhouses | Higher values, city tax rate |
| Highlandtown, Patterson Park, Pigtown | Rowhouses and some conversions | Rental license, lead certificate, unit legality |
| Hamilton, Lauraville, Belair-Edison | Rowhouses and detached homes | Water account and ground rent |
| Dundalk, Essex, Parkville | Single-family and duplexes | Baltimore County taxes, flood maps near the water |
The usual sequence is simple: finish the work, get a tenant in place, order the appraisal and pay off the short-term lender with a long-term DSCR loan. Underwriting looks at the lease, the appraised value and the full monthly payment including taxes and insurance, with 1.0x as the standard minimum ratio.
In Baltimore, title searches often turn up items that must be cleared before closing: unpaid water bills, which can become liens, ground rent, and open code violations. Ask your title company to check early so the payoff and the refinance close on schedule.
This example is illustrative and not a quote. An investor gutted and renovated a Highlandtown rowhouse with a hard money loan. It leases for $2,000 a month and appraises at $260,000. The hard money payoff is $180,000.
The new loan of $188,000 covers the $180,000 payoff plus $8,000 in closing costs, about 72% of the $260,000 value. Estimated principal and interest on a 30-year term is about $1,298. With taxes of $487 and insurance of $110 a month, the full payment is about $1,895 and DSCR is about 1.06x on $2,000 of rent.
The city tax bill is the largest cost after principal and interest, which is why Baltimore County rentals at similar prices can show a stronger ratio.
Underwriting divides the rent by the full monthly payment, including taxes and insurance, to get the ratio. Use your actual tax bill and a current insurance quote, not estimates from the listing, so the figure you see is close to the one the underwriter sees.
| Item | Before: hard money note | After: DSCR rate-and-term |
|---|---|---|
| Loan balance | $180,000 | $188,000 |
| Monthly principal and interest | $1,725 (interest only) | $1,298 |
| Taxes, insurance | $597 | $597 |
| Total monthly payment | $2,322 | $1,895 |
| DSCR at $2,000 rent | About 0.86x | About 1.06x |
| Term | Short-term, due soon | 30 years |
Baltimore City's property tax rate is high compared with the surrounding counties. Maryland reassesses on a three-year cycle and phases in increases, and the homestead tax credit only applies to owner-occupants. Budget on the full rate for the next assessment year.
Maryland charges recordation tax on deeds of trust, and some counties add their own taxes. A refinance can be partly exempt for the amount of the existing balance in some cases, so ask your title company to calculate it.
Baltimore City requires every rental property to be licensed, which includes an inspection by a licensed home inspector. Maryland requires most rentals built before 1978 to be registered with the Department of the Environment and to meet lead risk reduction standards at each tenant turnover.
Some Baltimore rowhouses are subject to ground rent, a small annual payment owed to the ground rent holder. It has to be identified on title and handled at closing.
Many larger Baltimore rowhouses have been converted into two or three units. A conversion counts only if the city recognizes the units. Small apartment buildings with five to eight units are residential for DSCR purposes, though max LTV varies by program.
Many investors start by asking for cash-out and end up with rate-and-term once they see the payment. A smaller balance means a higher DSCR, which can open more programs. Cash-out tops out at 75% LTV and its seasoning varies by program, while rate-and-term can reach 80% LTV on some programs.
Baltimore investors who did a full gut renovation sometimes have equity for cash-out, but rate-and-term keeps the payment manageable against the city's high tax bill.
Have these ready when you request a quote. A complete package gets a faster answer.
Use the form below with the address, payoff amount, lease rent and an estimate of value. LendingStreet refinances investor rentals in Baltimore City and Baltimore, Anne Arundel and Howard counties, and we will run the DSCR on your actual tax and insurance numbers before quoting. Our investor loans are business-purpose loans on non-owner-occupied property. Statewide details are on our Maryland rate-and-term refinance page, or call (877) 298-1001.
Yes, you should have one. The city requires every rental to be licensed, and underwriting may ask for it.
It is a small annual payment some rowhouses owe to a ground rent holder. Title will identify it, and it is handled at closing.
Yes. Unpaid Baltimore water bills can become liens on the property. Pay the account and get a final reading before closing.
Often, because the tax rate is lower than in the city. The rent and value still decide the file.
No. The loan qualifies on the property's rent compared with the full monthly payment. We still review credit, reserves and the property itself.
Yes. LLC borrowers are standard on our DSCR programs. Members typically sign for the loan personally, and we review the operating agreement and EIN letter.
The minimum credit score is 620. Stronger credit and lower leverage can open more program options.
You have choices. You can bring cash to lower the balance, or look at sub-1.0 DSCR programs that accept a ratio below the 1.0x standard minimum.
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