DSCR Loans for Short-Term Rentals (Airbnb & Vacation Rentals)

Short-term rental properties can qualify for DSCR financing — but not every program allows STR income. Here’s how it works and what to look for.

How STR DSCR Works

Standard DSCR loans use long-term market rent (from the appraiser’s rent schedule) in the coverage calculation. STR-eligible programs instead use a short-term rental income projection — typically sourced from an STR market data provider — to estimate gross annual income, then annualize it for the DSCR calculation.

Because STR income can significantly exceed long-term rent in the right markets, this can produce a much stronger DSCR ratio — and qualify a property that wouldn’t pencil under a standard program.

Key Requirements

• Program must explicitly allow STR income — not all DSCR programs do.
• The property must be in a market with supportable STR income data.
• STR income projection typically comes from a third-party source accepted by the lender.
• Credit and LTV requirements are program-specific; STR properties may have slightly tighter LTV limits than long-term rental.

What to Confirm Before Buying

• Is the property in an area that allows short-term rentals (HOA and local ordinances)?
• Does your target DSCR program accept STR income?
• What does the STR income projection show for that specific property and market?

Matching the right program to an STR property is critical — tell us the property and market and we’ll confirm eligibility before you’re under contract.