How It Works
The explosion of the short-term rental (STR) market, driven by platforms like Airbnb and VRBO, has created lucrative opportunities for investors. However, traditional lenders often struggle to underwrite these properties due to fluctuating seasonal income. Enter the STR DSCR loan.
When underwriting a short-term rental for a DSCR loan, lenders typically use one of two methods to determine the property's income potential: Operating History (reviewing the past 12 months of revenue statements from the booking platform) or AirDNA Data (projecting expected revenue based on comparables for new STRs).
Key Benefits
Higher Cash Flow Potential
STRs often generate significantly more income than long-term rentals, making it easier to achieve a strong DSCR ratio.
Purchase New Markets
Use AirDNA projections to buy properties in vacation markets even if the property has never been used as an STR before.
Scale Your Portfolio
STR DSCR loans do not report to personal credit bureaus and have no limits on the number of properties financed.
Typical Guidelines
If you're looking to capitalize on the high yields of the vacation rental market, an STR DSCR loan provides the specialized underwriting needed to get your deals funded.
Submit Your Scenario
Get started by completing the form below and an associate will reach out to get your free quote.
"*" indicates required fields