Baltimore rowhouses, Prince George's County single-family homes and western Maryland duplexes all show up in investor portfolios. A DSCR rate-and-term refinance replaces hard money or a higher-rate loan with long-term debt qualified on the rent.
In short: Yes, LendingStreet finances DSCR rate-and-term refinances on 1-8 unit investment properties in Maryland, up to 80% LTV on some programs, qualified on the property's rent with no W-2s or tax returns. The new loan pays off your existing hard money, bridge or higher-rate loan plus closing costs, with only a small amount of cash back allowed on most programs. Our investor loans are business-purpose loans on non-owner-occupied property, starting at $150,000 with a 620 minimum credit score. In Maryland, recordation tax on the new loan and local rental licensing are the items that most often affect cost and timing.
This kind of refinance swaps one loan for another. The new loan pays off the old one plus closing costs, and the cash you can receive at closing is limited to a small allowance that varies by program. Anything more is treated as a cash-out refinance with a lower LTV ceiling.
The appeal is leverage and terms. Some programs allow up to 80% LTV on a rate-and-term, and 30-year terms are available. The file is underwritten on the property's rent compared with the new payment, with a standard minimum DSCR of 1.0x and a 620 minimum credit score.
Maryland rental stock includes Baltimore brick rowhouses, older single-family homes in Prince George's and Baltimore counties, and duplexes and small buildings in Hagerstown, Frederick and Cumberland. Investors buy, renovate with short-term money and refinance. Rate-and-term also lets investors exit a short-term loan with a fixed 30-year payment.
Because the loan qualifies on rent, the refinance does not depend on your personal income, which matters to investors whose tax returns show heavy depreciation or self-employment write-offs. The property has to carry itself, and that is the test.
The most common rate-and-term refinance we see is the exit from short-term debt. You bought with a hard money or bridge loan, finished the work, placed a tenant and now need permanent financing before the short-term loan comes due. The bridge-to-DSCR guide walks through timing in more detail.
How the new loan is sized depends partly on how long you have owned the property. Some programs use the new appraised value after a period of ownership; others cap the loan near your cost basis if you bought recently. Seasoning rules vary by program, so check them before you count on the after-repair value.
Maryland charges recordation tax on recorded instruments, including many deeds of trust, and counties set the rates. On a refinance, the tax is often limited to new money above the existing balance when the borrower stays the same, but rules and exemptions vary, so ask the title company for the figure.
State and county transfer taxes apply to deeds, not a standard refinance. If you are moving title into an LLC, transfer and recordation taxes can apply, so check first.
Baltimore City requires rental properties to be licensed and inspected, and several counties have their own rental licensing. Lenders may ask for current licenses. Baltimore also has a history of ground rents on some rowhouses, which title will check.
Property taxes are moderate to high depending on the county, and Baltimore City has some of the higher rates. Montgomery County has rent stabilization rules, and lead paint rules apply to many older rental units statewide.
This example is illustrative and not a quote. An investor owns a renovated brick rowhouse in Baltimore appraised at $240,000. The existing hard money loan used for the purchase and rehab has a payoff of $172,000, costs about $1,580 a month interest-only and matures in 3 months. Rent is $1,950 a month, and taxes, insurance and any HOA dues run $420 a month.
Rolling about $7,000 of closing costs into the loan gives a new balance of $179,000, or about 74.6% LTV, inside the 80% ceiling some programs allow. On a 30-year term, principal and interest is about $1,221, so the full payment is about $1,641 and the DSCR is about 1.19x. The short-term maturity is gone and the payment is fixed. The rent could fall by about $309 a month before the ratio hit 1.0x.
| Item | Amount |
|---|---|
| Appraised value | $240,000 |
| Existing loan payoff | $172,000 |
| Closing costs rolled in | $7,000 |
| New loan amount | $179,000 |
| Loan-to-value | 74.6% |
| Principal and interest (30 years) | About $1,221 |
| Taxes, insurance and HOA | $420 |
| Total monthly payment | About $1,641 |
| Monthly rent | $1,950 |
| DSCR | About 1.19x |
Both are qualified on rent, but the purpose drives the limits. A quick side-by-side helps decide which one fits the property.
Some investors in Maryland do both in stages: a rate-and-term refinance to exit short-term debt now, then a cash-out later once seasoning and value support it. Others go straight to cash-out if the appraisal is strong and they need capital for the next deal.
| Feature | Rate-and-term | Cash-out |
|---|---|---|
| Purpose | Pay off existing loan and costs | Pay off loan and take equity |
| Maximum LTV | Up to 80% on some programs | Up to 75% |
| Cash at closing | Small allowance, varies by program | Up to the LTV limit |
| Minimum DSCR (standard) | 1.0x | 1.0x |
| Minimum credit score | 620 | 620 |
| Income documents | Rent only, no W-2s or tax returns | Rent only, no W-2s or tax returns |
Baltimore neighborhoods such as Hampden, Highlandtown, Pigtown and Belair-Edison have rowhouses at a range of prices. Prince George's County and Baltimore County offer single-family rentals near DC and Baltimore jobs. Frederick and Hagerstown have duplexes and small multifamily, and Annapolis and Columbia carry higher values.
These items cover most of what underwriting will ask for. Call (877) 298-1001 or use the form below to get a quote.
Yes. LendingStreet refinances non-owner-occupied 1-8 unit rentals in Maryland with DSCR loans starting at $150,000, up to 80% LTV on some programs.
Recordation tax can apply to deeds of trust. On a refinance it is often limited to new money when the borrower stays the same. Your title company can confirm.
Most programs allow a small amount of cash back at closing, but the limit varies. Taking more turns the loan into a cash-out refinance, which has a 75% LTV ceiling.
Baltimore City requires rental licenses and inspections, and lenders may ask for them. Having it current keeps underwriting smooth.
Seasoning varies by program. Recently purchased properties may be sized on purchase price plus documented improvements rather than the new appraised value.
DSCR loans start at $150,000, so lower-value rowhouses can be hard to fit. Rowhouses valued high enough to support a $150,000 loan at the program LTV can qualify.
Standard programs need at least 1.0x. Sub-1.0 DSCR programs exist, or you can lower the balance by bringing cash to closing.
Yes. 30-year terms are available on DSCR loans, which is the main reason investors use a rate-and-term refinance to replace short-term or balloon debt.
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