All questions
What is a DSCR loan?
A DSCR (debt service coverage ratio) loan is a business-purpose investment property loan that qualifies mainly on whether the property's rent covers its full monthly payment: principal, interest, taxes, insurance and any HOA dues. Personal tax returns and W-2s are generally not used. See how Maryland DSCR loans work.
What DSCR do I need for a Maryland rental?
Each wholesale lender sets its own minimum. Many programs look for a ratio at or above 1.00, meaning the rent covers the payment, and files with more coverage usually have more options. Some programs consider ratios below 1.00 with extra conditions. Test your numbers in the DSCR calculator.
How do I calculate DSCR?
Divide monthly rent by the full monthly payment (PITIA). Example with user-style inputs: $2,400 rent ÷ $2,000 PITIA = 1.20. A ratio below 1.00 means the rent does not cover the payment.
Can I get a DSCR loan in an LLC in Maryland?
Usually yes, with personal guarantees from the members and entity documents in good standing with SDAT. See the Maryland LLC DSCR guide.
Can I use short-term rental income for a DSCR loan in Maryland?
Some programs accept short-term rental income from a lawful, licensed STR, using a booking history or an income analysis. Local rules decide whether an STR is allowed; Montgomery County generally requires the host to live there. See short-term rental DSCR.
Can I live in a property financed with a DSCR loan?
No. We arrange business-purpose financing for non-owner-occupied investment property only. If you or any family member will live in any unit, including one side of a duplex, we cannot take the request.
Do I need tax returns or W-2s for a Maryland DSCR loan?
Generally no. Lenders focus on the property's rent, your credit, your reserves and your down payment. You will provide bank statements for funds and, for an LLC, entity documents.
Does a Baltimore rental need a license to qualify for a DSCR loan?
Baltimore City requires non-owner-occupied rentals to be registered and licensed after a passing inspection, and lenders and title companies may ask about it. See the Baltimore rental license guide.
Do Maryland lead-paint rules affect my DSCR loan?
Pre-1978 rentals must be registered with MDE and meet turnover standards. Noncompliance puts the rent at risk, so lenders and title may ask. See the lead-paint registration guide.
Do property taxes and insurance count in the DSCR?
Yes. Both are part of the monthly payment the rent is compared with. Maryland taxes vary widely by county and town, and flood or wind insurance near the water can be significant. See the taxes and insurance guide.
Can I take cash out of a Maryland rental with a DSCR loan?
Yes, when the rent covers the new, larger payment and the lender's seasoning and leverage rules are met. Proceeds must be used for business purposes. See cash-out DSCR refinance.
Can I finance a duplex or fourplex with a DSCR loan?
Yes. Rent from every unit is combined and compared with one payment, provided no unit is owner- or family-occupied. See 2-4 unit DSCR loans.
Can I finance several Maryland rentals at once?
Some programs offer blanket or multi-property financing, and others finance each property separately. See portfolio DSCR.
Is a DSCR loan better than hard money for a Baltimore rowhouse?
They do different jobs. Hard money fits buying and renovating; a DSCR loan fits holding a rent-ready, licensed rental long term. Many investors use both. See DSCR vs. hard money.
Do you publish DSCR rates?
No. Pricing depends on credit, leverage, the ratio, property type, loan size and the market on the day the loan is priced, so we quote only after reviewing your scenario.
Are you a lender?
No. Loan Daddy LLC (NMLS #2827624) is a mortgage broker, not a lender. We arrange and shop financing from wholesale lenders, who underwrite and fund the loans.
What does a broker do on a Maryland DSCR loan?
We review your scenario, compare how several wholesale lenders would treat it, help you assemble the documents and coordinate the file through closing with the lender you choose.