Seeking Advice on Financing an Airbnb/Short-Term Rental

[Frank Pyle]

My client recently purchased a home with a hard money loan and have successfully rehabbed it for use as an Airbnb rental. It has been operating for 2 months now. Our lender has informed us that we need 12 months of rental history to use the actual rent for financing purposes, or we must rely on the appraiser's fair market short term rental value. The challenge we're facing is the lack of short term rental data for the appraiser, and we won't know if it will meet the debt service coverage ratio (DSCR) requirements until the appraisal is complete.

Has anyone dealt with a similar situation? Do you have any suggestions on how we can secure long-term financing under these circumstances?

Thanks in advance for your help!

[Trevor Finn]

Hi @Frank Pyle,

**I am not affiliated with any of the companies mentioned**

To secure long-term financing for your Airbnb, look for DSCR lenders that accept pro forma income instead of requiring 12 months of rental history. Use tools like AirDNA or Mashvisor to provide market data on projected rental income and occupancy rates, and make sure your lender works with appraisers familiar with short-term rentals. If your current lender can’t accommodate you, explore STR-focused lenders like Host Financial or Lima One Capital, or consider bridge loans to buy time while you build your rental history. Providing strong supporting data from your Airbnb bookings, market comps, and STR reports will strengthen your case and help you close faster!

Good luck! 🚀