Maryland's vacation rentals split between Ocean City on the Atlantic, Deep Creek Lake in the western mountains and the towns along the Chesapeake Bay. The larger jurisdictions near Washington and Baltimore tie most short-term rentals to a primary residence.
In short: You can finance a Maryland Airbnb or VRBO property with a DSCR loan from LendingStreet, and on some programs the property qualifies on projected short-term rental income instead of a long-term lease. Loans start at $150,000 with no stated maximum, the minimum credit score is 620 and there are no W-2s or tax returns. Ocean City and Deep Creek are the main investor markets, while Montgomery County and Baltimore City tie most short-term rentals to a host's primary residence.
Ocean City is the state's main beach market, with high-rise and mid-rise condos along Coastal Highway and homes in West Ocean City and Ocean Pines. Families from Baltimore, Washington and Pennsylvania book weekly summer stays.
Deep Creek Lake in Garrett County draws summer boaters and Wisp Resort skiers. Annapolis, St. Michaels and Solomons serve sailors and weekenders along the Chesapeake Bay, and Frederick and Cumberland attract history and outdoor visitors. Ocean City's stock is mostly condos, while Deep Creek and the Bay towns lean toward single-family homes and cottages.
| Market | Who books | What to check |
|---|---|---|
| Ocean City | Weekly summer families | Town rental license, condo rules |
| Deep Creek Lake | Boaters, skiers | County rental license, septic |
| Annapolis | Sailors, Naval Academy visitors | City license, caps |
| Eastern Shore towns | Weekenders | Town rules, flood zone |
Ocean City requires rental licenses for short-term rentals, and many condo associations set their own rules. Garrett County licenses transient vacation rental units around Deep Creek Lake and sets occupancy limits based on septic capacity. Annapolis licenses short-term rentals and limits them.
Montgomery County and Baltimore City tie most short-term rentals to the host's primary residence, which rules out many investor properties there. Check the rules for the exact address.
The ratio is simple: monthly income divided by the monthly payment, where the payment includes principal, interest, taxes, insurance and HOA dues. What changes on a short-term rental is the income figure. Some programs accept a projection of nightly-rental revenue from a third-party data provider; others lean on 12 months of booking history.
A ratio of 1.0x or better meets the standard minimum, and some programs go below it. Leverage tops out at 80% LTV on a purchase and 75% on a cash-out refinance, but short-term rental programs and bigger balances can be lower, so it varies by program. No W-2s, a 620 minimum score, LLC borrowers welcome and terms up to 30 years. The program covers one to eight units, which includes duplexes and small cottage groups; nine units or more is handled as commercial.
Maryland applies its state sales tax to short-term lodging, and counties and some cities add hotel rental taxes. Platforms collect many of these, but registration with the county may still be required.
Maryland's transfer and recordation taxes at purchase are among the higher ones in the region and vary by county. Budget for them in your cash to close. Property is reassessed on a three-year cycle, and the Homestead Tax Credit only applies to an owner's primary residence.
Ocean City condos carry master policies and wind exposure, and flood insurance is generally required in mapped zones. At Deep Creek, snow loads, septic systems and steep drives affect insurance and appraisal.
Garrett County's septic-based occupancy limits matter at Deep Creek, since a home rated for fewer guests may earn less than its bedroom count suggests. Ask for the septic rating along with the rental license.
This example is illustrative and not a quote. An investor buys a two-bedroom oceanblock condo in Ocean City for $430,000. A projection for comparable units shows $44,000 a year in gross revenue. At 75% LTV the loan is $322,500, and estimated principal and interest on a 30-year term is about $2,255 a month. Add $340 in taxes, $60 in insurance and $480 in HOA dues, and the payment is about $3,135. $3,667 of average monthly revenue divided by that payment gives a DSCR of about 1.17x.
If the projection came in lower, the investor could borrow less. At 70% LTV the loan is $301,000, the payment about $2,985 and the DSCR about 1.23x, with $21,500 more brought to closing. The HOA line includes the building's master policy, which is why the separate insurance figure is small. Compare buildings on dues, reserves and any special assessments.
| Item | Amount |
|---|---|
| Purchase price | $430,000 |
| Loan amount at 75% LTV | $322,500 |
| Down payment | $107,500 |
| Projected annual revenue | $44,000 |
| Average monthly revenue | $3,667 |
| Estimated principal and interest (30-year) | $2,255 |
| Property taxes | $340 |
| Insurance | $60 |
| HOA dues | $480 |
| Total monthly payment | $3,135 |
| DSCR | About 1.17x |
Ocean City earns most of its revenue from June through August, with strong weekends in May and September and big event weekends. Deep Creek Lake has a summer season and a ski season. Bay towns are busiest in summer and during boat shows and Naval Academy events. Winter is slow on the coast.
A complete file moves faster. Gather these before you apply:
Our investor loans are business-purpose loans on non-owner-occupied property. Share the address, the price, a revenue projection and how much leverage you want. We run the ratio on realistic taxes and insurance and come back with a few structures, plus a refinance path once the property has a booking history of its own.
We lend in Worcester, Garrett, Anne Arundel, Talbot and the rest of Maryland's counties. Reach us at (877) 298-1001, or get a quote through the form below.
Generally not. Both tie most short-term rentals to the host's primary residence.
Yes. Ocean City requires rental licenses, and many condo associations set their own rules.
Yes. Garrett County sets occupancy based on septic capacity and licenses transient vacation rentals.
Maryland's transfer and recordation taxes are relatively high and vary by county, so budget for them up front.
Not on every program. Some qualify a short-term rental on projected nightly revenue or on its booking history instead of a 12-month lease.
Yes. Once you have booking history, a rate-and-term or cash-out refinance can use actual revenue. Our STR refinance guide, linked below, covers how that works.
No. Our investor loans are business-purpose loans on non-owner-occupied property only, so primary and second homes are out.
Timing depends mostly on the appraisal, title and insurance. A complete file with the revenue projection, permit confirmation and insurance quote in hand moves fastest.
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