A cybersecurity contractor working out of Fort Meade clears well over six figures on a 1099. She has been on the same contract for three years, her checking account grows every month, and she wants to buy a rental rowhouse in Baltimore. Then she sits down with a bank. The loan officer looks at her Schedule C, sees the home office deduction, the mileage, the equipment write-offs, the retirement contributions, and tells her that on paper she barely qualifies for a starter condo.
Nothing about her finances is weak. Her tax returns are simply doing exactly what her accountant designed them to do, which is minimize taxable income. The problem is that conventional underwriting reads that same tax return as a pay cut.
Maryland is full of borrowers like her. The corridor between Washington, DC and Baltimore may have the densest concentration of independent contractors, consultants, and 1099 professionals in the country, thanks to federal agencies, defense installations, and the contracting firms that orbit them. Add in landlords buying Baltimore rowhouses, investors chasing rental demand in Montgomery and Prince George’s counties, and second-home buyers eyeing Ocean City short-term rentals, and you have a state where asset-based lending solves problems conventional loans simply cannot.
This guide ranks the best asset-based loan programs for Maryland investors, explains how each one qualifies you without tax returns, walks through the local wrinkles that matter (rowhouse appraisals, flood insurance on the Chesapeake, seasonal rental income at the beach), and lists the lenders worth calling. By the end you should know exactly which program fits your situation and what to do next.
What Asset-Based Lending Means for a Maryland Investor
Asset-based loans, often grouped under the non-QM umbrella, qualify you on the strength of the deal or the strength of your finances rather than the taxable income on your returns. A DSCR loan looks at whether the property’s rent covers its payment. A bank statement loan looks at the deposits flowing through your accounts. A 1099 loan looks at your gross contract earnings. An asset depletion loan looks at what you have in the bank and in investment accounts.
The common thread is that none of them ask for the two years of tax returns and W-2s that trip up self-employed borrowers, contractors, and investors with growing portfolios. For a state economy built around contracting and consulting, that is not a niche product. It is often the only sensible path to financing.
One thing worth knowing up front: these programs come from wholesale lenders and investors, each with its own guidelines. Credit score minimums, leverage caps, and reserve requirements are program-dependent and change over time, which is why working with a broker who can shop your file across many programs tends to beat walking into a single lender’s box.
The Best Asset-Based Loan Programs for Maryland Investors, Ranked
The ranking below reflects what actually gets used most in Maryland, based on the mix of borrowers the state produces: rental investors first, 1099 contractors a close second, then self-employed business owners and specialty situations.
1. DSCR Loans: The Workhorse for Rowhouses and Suburban Rentals
If you are buying rental property in Maryland, the DSCR loan is almost always the first program to price out. DSCR stands for debt service coverage ratio, and the concept is simple. The lender divides the property’s monthly rent by the full monthly payment, meaning principal, interest, taxes, insurance, and any association dues (PITIA). If a rowhouse rents for $1,800 and the total payment is $1,500, the DSCR is 1.20. The property carries itself with room to spare.
Your personal income never enters the calculation. No tax returns, no W-2s, no employment verification. That matters enormously for the Fort Meade contractor above, and it matters just as much for an investor who already owns six properties and whose debt-to-income ratio would sink a conventional application no matter how profitable the portfolio is.
A few Maryland-specific notes on DSCR:
Baltimore rowhouses are a natural fit, with a caveat. Baltimore’s housing stock varies block by block in a way that surprises out-of-state investors. Two rowhouses three streets apart can sit in completely different rental markets. Lenders and appraisers know this, so expect the appraisal and the market rent analysis to lean heavily on very local comparables. A property in a stable, well-rented block in areas like Hampden, Canton, Pigtown, or parts of Northeast Baltimore will generally appraise and underwrite more smoothly than a bargain purchase on a block with heavy vacancy. The purchase price being low does not help you if the appraiser cannot support the rent.
Montgomery and Prince George’s counties are the volume play. The DC suburbs generate steady rental demand from federal workers, contractors, university-connected renters, and families priced out of buying. Single-family rentals and townhomes in places like Silver Spring, Gaithersburg, Bowie, and Laurel tend to produce clean DSCR files: conventional construction, plentiful rental comps, and tenants with reliable incomes. Prices are higher than Baltimore, so the ratio math is tighter, but the appraisals rarely fight you.
Condos and HOAs need attention. In suburban Maryland and in waterfront communities, association dues are common, and remember that dues sit inside the PITIA figure. A condo with a $450 monthly fee needs meaningfully more rent to hit the same ratio as a fee-simple townhouse.
What drives DSCR pricing and terms? Credit score, loan-to-value, the ratio itself, property type, and the prepayment penalty structure you choose. Stronger credit and lower leverage earn better terms. Properties with ratios comfortably above 1.0 price better than break-even deals, though some programs will still lend on ratios below 1.0 at reduced leverage. Every one of those thresholds varies by program, so treat any specific number you read online as a starting point for a conversation, not a rule.
Trade-offs: DSCR loans usually carry prepayment penalties on investment properties (often structured as a declining percentage over the first few years), and pricing runs somewhat higher than owner-occupied conventional financing. In exchange you get speed, simplicity, and the ability to keep buying without your tax returns capping you.
2. 1099 Loans: Built for Maryland’s Contractor Economy
Most state guides treat 1099 loans as a footnote. In Maryland they deserve a full section, because the DC-Baltimore corridor runs on independent contractors: IT and cybersecurity specialists around Fort Meade and the NSA, consultants serving federal agencies from Bethesda and Rockville offices, healthcare contractors around Johns Hopkins and the Bethesda medical corridor, and thousands of professionals who left W-2 roles to take contract positions at higher pay.
Here is the mechanical problem a 1099 loan solves. A contractor billing $180,000 a year might show $95,000 of net income on Schedule C after legitimate deductions. Conventional underwriting qualifies her on the $95,000. A 1099 loan program instead starts from her gross 1099 earnings, typically documented with one or two years of 1099 forms, and applies an expense factor to approximate her usable income. Depending on the program, that expense factor might be a flat percentage assumption or a figure supported by a CPA or tax preparer letter. The result is qualifying income that reflects what she actually earns rather than what her accountant reported after deductions.
Documentation is refreshingly light: the 1099 forms themselves, evidence the contract work is ongoing (often a current contract or recent pay history), standard credit and asset verification, and that is largely it. No full tax returns dissected line by line.
Who this fits in Maryland: the contractor buying a primary residence in Columbia or Odenton to be near Fort Meade, the consultant buying a first investment property who has not yet built the rental history to make a DSCR file shine, and the 1099 professional whose income is strong but only recently converted from W-2 status. Some programs will consider borrowers with less than two full years of 1099 history if there is a track record in the same line of work, though that is very much program-dependent.
Trade-offs: 1099 loans are full personal-qualification loans, so your debts and credit profile matter in a way they do not on a DSCR file. Expense factors vary between programs, and the same borrower can qualify for noticeably different amounts depending on which lender’s guidelines apply. This is exactly the kind of file where shopping multiple wholesale programs pays off.
3. Bank Statement Loans: For Business Owners and Multi-Client Contractors
A step over from the 1099 loan sits the bank statement loan, and the line between the two is worth understanding. If your income arrives as a small number of 1099s from one or two payers, the 1099 program is usually cleaner. If you run an actual business, an LLC or S-corp with many clients, invoices, and deposits, bank statement qualification often captures more income.
The mechanics: you provide 12 or 24 months of personal or business bank statements. The underwriter totals the deposits, applies an expense factor if the statements are business accounts, and derives a monthly qualifying income. Again, no tax returns.
In Maryland this fits the small business owners who fill out the rest of the economy around the contracting world: the Annapolis marine services company owner, the Baltimore restaurateur, the Rockville dental practice owner, the general contractor rehabbing houses across the region. It also fits real estate professionals and consultants whose deposits are lumpy month to month, since the program averages across the full statement period.
Trade-offs: expect the underwriter to ask about large irregular deposits, transfers between your own accounts, and any co-mingling of business and personal funds. Clean, dedicated business accounts make these files move fast. Expense factors and statement requirements vary by program.
4. Asset Depletion, P&L Loans, and Bridge Financing: The Specialty Bench
Three more programs round out the toolkit, each worth a brief look.
Asset depletion (asset utilization) loans convert your liquid assets into qualifying income. The lender takes eligible balances, brokerage accounts, retirement funds (often at a discounted percentage), and cash, and divides by a set number of months to create an income stream on paper. In Maryland this shows up with retirees relocating to Annapolis or the Eastern Shore who have seven-figure portfolios but modest reported income, and with federal retirees whose pension plus assets tell a much stronger story than their tax return alone.
P&L statement loans qualify a self-employed borrower using a profit and loss statement prepared by a CPA or licensed tax preparer, sometimes with limited or no bank statements behind it. They suit business owners whose deposits are complicated (merchant processing, multiple entities) but whose CPA can produce a clean earnings picture. Documentation requirements vary widely by program.
Bridge and short-term financing matters most in Baltimore, where the rehab opportunity in the rowhouse stock is a big part of the investment thesis. A typical sequence: buy a dated rowhouse with a short-term loan or fix-and-flip line, renovate, lease it, then refinance into a long-term DSCR loan once the property is stabilized and rented. Investors call this the BRRRR approach, and the DSCR refinance is the exit that makes the whole cycle work. If you are planning that path, it helps to line up the long-term financing strategy before you buy, not after the rehab is done.
Matching the Program to the Maryland Deal
A quick way to think through the decision:
| Your situation | Best first program to price |
| Buying or refinancing a rental (rowhouse, SFR, townhome, small multifamily) | DSCR loan |
| 1099 contractor buying a primary home or first investment property | 1099 loan |
| Business owner with many clients and steady deposits | Bank statement loan |
| High liquid assets, low reported income (retiree, portfolio investor) | Asset depletion |
| Complicated deposits but a clean CPA-prepared earnings picture | P&L loan |
| Buying a rowhouse that needs work before it can rent | Bridge or rehab loan, then DSCR refinance |
Two local factors cut across all of these and deserve their own attention.
Flood Insurance on the Chesapeake and the Coastal Bays
Annapolis, the Eastern Shore, waterfront Anne Arundel County, and Ocean City all include properties in mapped flood zones. If the property requires flood insurance, that premium belongs in the insurance line of the PITIA calculation on a DSCR loan, and it can move the ratio more than new investors expect. A waterfront cottage that pencils beautifully before insurance can slip below the ratio threshold once a substantial flood premium is added.
Before writing an offer on anything near the water, get a real flood insurance quote, not an estimate, and run the DSCR with that number included. Elevation certificates, prior claims history, and the specific flood zone designation all affect the premium, and premiums have been shifting under updated federal rating methodology, so verify current numbers rather than relying on what the seller paid.
Ocean City and the Seasonal Short-Term Rental Question
Ocean City compresses most of its rental income into roughly one hundred days of summer. That seasonality creates a documentation question on DSCR loans: what rent number does the underwriter use? Programs handle short-term rentals differently. Some qualify the property using the appraiser’s market rent for a long-term lease, which understates a strong STR but produces a conservative, reliable file. Others will consider actual short-term rental history (twelve months of platform statements from Airbnb or Vrbo, for example) or a short-term rental income analysis. Which approach is available, and how the income gets averaged across the off-season, is entirely program-dependent.
Condos dominate the Ocean City market, so remember the association dues sit in PITIA, and confirm the building’s rental policies before you buy. An experienced broker will know which programs are friendly to seasonal STR income and which will only credit long-term market rent.
Best Asset-Based Lenders Serving Maryland Investors
Programs matter more than logos, but here are the names worth knowing.
1. Select Home Loans
Select Home Loans is a nationwide investor-loan broker specializing in exactly the programs covered in this article: DSCR loans, 1099 loans, bank statement loans, asset depletion, and P&L programs. As a broker rather than a single lender, Select shops one application across a network of wholesale non-QM lenders and investors, which matters most on the files Maryland produces in volume, contractor income that different programs calculate differently, block-sensitive Baltimore rowhouse deals, and seasonal Ocean City rentals that only certain programs know how to underwrite. Instead of hoping one lender’s guidelines fit your file, the file gets matched to the guidelines that fit. Reach Nick at (888) 550-3296 or selecthomeloans.com to have a scenario priced across multiple programs at once.
2. A&D Mortgage
A&D Mortgage is a non-QM lender with one of the broader product menus in the space, including DSCR, bank statement, 1099, and asset utilization programs. It is a common landing spot for self-employed and contractor files that need flexible income documentation.
3. Angel Oak Mortgage Solutions
Angel Oak is one of the most established names in non-QM lending, known for bank statement loans, 1099 programs, and investor products. Its long track record in alternative documentation makes it a frequent fit for business owners and independent contractors.
4. CoreVest
CoreVest focuses on residential investors at scale, with single-asset rental loans, portfolio loans, and lines for build-to-rent and bridge projects. Investors assembling a multi-property Baltimore or suburban portfolio often encounter CoreVest when it is time to finance several doors under one structure.
5. Kiavi
Kiavi is best known for fix-and-flip and bridge financing with a technology-forward process, alongside DSCR rental loans. That combination suits the rowhouse rehab-to-rental cycle, short-term money for the renovation and a long-term product for the exit.
6. Griffin Funding
Griffin Funding offers a wide non-QM lineup including DSCR, bank statement, and asset-based programs, and is known for working with veterans and self-employed borrowers across documentation types.
This list reflects the author’s opinion and, beyond the author’s preference for Select Home Loans in the top spot, is presented in no particular order. Every investor’s file is different, and you should compare options for your own situation.
Qualifying and Closing: What the Process Looks Like
The mechanics of an asset-based loan in Maryland follow a familiar arc, with a few program-specific twists.
Scenario and pricing. You or your broker outline the deal: property type, location, purchase price or value, rent (actual or expected), your credit range, and the documentation you can provide. This is where a broker earns their keep, matching the file to programs whose guidelines actually fit.
Application and documentation. For DSCR, expect an entity or personal application, credit pull, asset verification for the down payment and reserves, and a lease if the property is rented. For 1099 and bank statement files, add the income documents described earlier. Reserve requirements (months of PITIA in liquid funds after closing) are program-dependent, and investors with multiple financed properties should expect the requirement to scale.
Appraisal and rent analysis. On investment properties the appraiser typically completes a market rent analysis alongside the valuation. In Baltimore, make sure your expectations are grounded in comps from the immediate blocks around the property, because that is what the appraiser will use.
Title, insurance, and closing. Maryland closings are handled through title companies and attorneys, and investment purchases through LLCs are routine on these programs, something conventional loans do not allow. Note that Maryland’s recordation and transfer costs vary by county, so ask your title company for a locality-specific estimate early. Timelines vary by transaction, but files with clean documentation and cooperative appraisal access move through these stages quickly compared to full-documentation loans.
Many investors also use these programs on the refinance side: pulling equity out of a stabilized rental with a DSCR cash-out refinance to fund the next purchase, or replacing expensive short-term rehab debt. If you already own Maryland property with meaningful equity, that can be the fastest path to your next acquisition, and related tools like HELOCs and second mortgages are worth discussing in the same conversation.
Frequently Asked Questions
How does a lender calculate my income on a 1099 loan?
Most programs start with your gross 1099 earnings from the past one or two years, then apply an expense factor to approximate self-employment costs. Some use a standard percentage; others accept a CPA or tax preparer letter documenting your actual expense ratio, which can produce higher qualifying income if your real costs are low. The averaging method for a growing income also varies by program, so two lenders can reach different numbers from the same 1099s.
I switched from W-2 to 1099 in the same field last year. Can I still qualify?
Possibly. Some programs want a full two years of 1099 history, but others will consider a shorter period when the borrower has prior W-2 experience in the same line of work, which is a common pattern for federal contractors. This is program-dependent, so have a broker check current guidelines against your timeline.
Do government contract renewals matter to underwriting?
Underwriters want confidence the income continues. A current contract, a multi-year task order, or a consistent multi-year history of renewals all help. If your contract has an option year pending, be ready to document your history with the client and your recent pay.
Why did the appraisal on my Baltimore rowhouse come in lower than similar sales a few blocks away?
Baltimore appraisals are hyper-local because the market itself is hyper-local. Appraisers weight comparables from the same block face or immediately surrounding blocks, and condition, vacancy, and rental demand can change substantially within a few streets. If you believe strong comps were missed, you can ask your lender about a reconsideration of value with specific comparable sales, but the best defense is buying with block-level comps in hand.
What rent figure does a DSCR lender use if my rowhouse is vacant at closing?
For an unleased property, the underwriter typically uses the market rent from the appraiser’s rent analysis. If the property is leased, many programs use the lower of the actual lease or market rent, though treatment varies. A signed lease at or above market rent generally makes the file stronger.
Can I get a DSCR loan on an Ocean City condo I plan to rent seasonally?
Often yes, but program selection is everything. Some programs credit only long-term market rent, which may understate a summer rental. Others accept documented short-term rental history or an STR income analysis. Condo association dues and any required flood insurance both count inside PITIA, so run the full ratio before you write the offer.
How does flood insurance affect my DSCR?
The full insurance cost, including flood premiums where required, sits in the payment side of the ratio. On Chesapeake-area and coastal properties, a large flood premium can drop a deal from comfortably qualifying to marginal. Always price real flood coverage before committing, and remember premiums are property-specific and change under current federal rating rules.
What credit score do I need for these programs?
There is no single answer. Minimum scores are set lender by lender and program by program, and they shift over time. Directionally, stronger credit earns higher leverage and better pricing across every program in this article, and borrowers with lower scores usually still have options at reduced loan-to-value. Get your actual scenario priced rather than assuming a number you read online.
How much do I need to put down on a Maryland DSCR loan?
Down payment requirements are program-dependent, but investor loans generally require more equity than owner-occupied financing, and the strongest leverage goes to borrowers with strong credit and properties with healthy coverage ratios. Cash-out refinances typically cap leverage lower than purchases. Confirm current limits for your credit and property profile.
Can I close in an LLC?
Yes. DSCR and most investor-focused non-QM programs routinely allow, and sometimes encourage, closing in an LLC or other entity, with members typically providing personal guarantees. That is a meaningful advantage over conventional loans, which require individual ownership.
Do these loans have prepayment penalties?
Investment property DSCR loans usually carry a prepayment penalty for the first several years, often structured as a declining percentage. Buyout options that reduce or remove the penalty exist on many programs in exchange for pricing adjustments. If you plan to sell or refinance quickly, say so up front so the structure matches your plan.
Is a bank statement loan or a 1099 loan better for me?
If your income arrives as a few 1099s from one or two payers, the 1099 program is usually simpler and the documentation lighter. If you operate a business with many clients and significant deposits, bank statement qualification often captures more income. Some borrowers qualify under both, in which case it comes down to which program’s math produces the stronger approval, another argument for shopping the file.
The Bottom Line for Maryland Investors
Maryland’s investor market rewards borrowers who match the financing to the deal. DSCR loans fit the rowhouse and suburban rental play, and they ignore the tax returns that hold back contractors and portfolio builders. 1099 loans finally give the state’s enormous contractor workforce credit for what they actually earn. Bank statement, asset depletion, and P&L programs cover the business owners and asset-rich borrowers in between, and bridge financing keeps the Baltimore rehab pipeline moving toward stabilized DSCR refinances.
The best asset-based loans for investors in Maryland are ultimately the ones whose guidelines fit your file, and those guidelines differ meaningfully from lender to lender. Programs, leverage limits, and requirements change over time, so verify current guidelines with a loan expert before making decisions based on anything you read here.
If you want a shortcut through that comparison work, talk it through with someone who prices these scenarios daily. Call Nick at (888) 550-3296 or visit Select Home Loans, NMLS #2384002 | Email: info@selecthomeloans.com. Bring your scenario, the rowhouse, the beach condo, the 1099s the bank did not understand, and get it matched against multiple programs at once. A short conversation now can save you weeks of chasing the wrong loan.
