Best DSCR Lenders for Airbnb and Short-Term Rental Properties in 2026

The short-term rental (STR) market has exploded over the past decade, with platforms like Airbnb and VRBO creating lucrative opportunities for real estate investors. However, financing Airbnb properties presents unique challenges—traditional lenders struggle to evaluate short-term rental income, and many conventional mortgage products explicitly exclude STRs.

DSCR (Debt Service Coverage Ratio) loans offer an ideal solution for short-term rental investors, but not all DSCR lenders understand or accept Airbnb properties. This guide identifies the best DSCR lenders specializing in short-term rental financing and explains how to successfully secure funding for your vacation rental investments.

Why Airbnb Properties Need Specialized Financing

Short-term rentals differ fundamentally from traditional long-term rentals:

Unique STR Characteristics:

• Income variability: Seasonal fluctuations and occupancy rates affect cash flow
• Higher revenues: Well-managed STRs often generate 2-3x traditional rental income
• Operating complexity: More intensive management, furnishings, and maintenance
• Regulatory uncertainty: Zoning, licensing, and short-term rental regulations vary widely
• Market sensitivity: Tourism trends and economic conditions impact performance

Traditional Lender Concerns:

• Difficulty verifying and projecting income
• Higher perceived risk due to income volatility
• Lack of standardized rental comparables
• Regulatory risk in changing STR markets
• Property condition requirements (fully furnished, higher standards)

DSCR Loan Advantages for STR:

• Income evaluation based on actual or projected STR performance
• Acceptance of AirDNA or similar market data
• Underwriting focused on property cash flow potential
• Flexibility for furnished property appraisals
• No personal income documentation required

Top DSCR Lenders for Airbnb Properties

1. Visio Lending

Visio Lending has embraced the short-term rental market with dedicated programs and specialized underwriting.

STR Program Features:

• Accepts short-term rental income for DSCR calculation
• Recognizes AirDNA reports and market analysis
• Minimum DSCR: 1.25 for STR properties
• LTV up to 80% (20% down)
• Loan amounts: $75,000 to $3 million
• 30-year fixed-rate options

Income Documentation:

• Historical Airbnb/VRBO income (12-24 months preferred)
• AirDNA market reports
• Professional rent analysis from appraiser
• Profit & loss statements for existing STRs

Property Requirements:

• Must be legally permitted for short-term rental
• Turnkey rentable condition
• Fully furnished (furniture value included in appraisal)
• Located in approved STR markets

Best For: Experienced STR investors with track record of successful Airbnb operations.

2. Lima One Capital

Lima One has built strong expertise in the short-term rental space, offering tailored programs for Airbnb investors.

Key Features:

• STR-specific underwriting guidelines
• Fast closings (21 days possible)
• DSCR minimum: 1.20 for short-term rentals
• LTV up to 80%
• Loan amounts: $100,000 to $5 million
• Technology-forward application process

STR Income Analysis:

• AirDNA reports weighted heavily
• Comparable STR performance data
• Seasonal adjustment factors
• Conservative occupancy assumptions (typically 60-70%)

Advantages:

• Understanding of STR market dynamics
• Acceptance of newer STR properties
• Flexible on regulatory environments (where legal)
• Portfolio STR financing available

Best For: Investors building short-term rental portfolios in strong tourism markets.

3. Anchor Loans

Anchor provides flexible DSCR financing for short-term rental properties with competitive terms.

Program Highlights:

• DSCR as low as 1.15 for strong STR markets
• LTV up to 75%
• Loan amounts: $100,000 to $5 million
• Quick decision timelines
• Nationwide lending

STR Approach:

• Market-specific underwriting (beach, mountain, urban markets)
• Acceptance of seasonal income patterns
• Review of local STR regulations as part of due diligence
• Consideration of property management company reputation

Documentation:

• 12-24 months Airbnb/VRBO statements
• AirDNA or similar market data
• Property management agreement (if applicable)
• Proof of STR legal compliance

Best For: Investors in established STR markets with clear regulatory frameworks.

4. JCAP Private Lending

JCAP offers high-touch service for short-term rental financing, with underwriting that considers STR nuances.

Features:

• Customized STR loan structures
• DSCR minimum: 1.25
• LTV up to 75%
• Loan amounts: $150,000 to $5 million
• Strong customer service and education

STR Evaluation:

• Deep dive into local market conditions
• Review of competitive landscape
• Analysis of property's unique STR appeal
• Conservative but realistic income projections

Unique Offerings:

• Guidance on optimizing STR properties for financing
• Recommendations for property improvements to enhance DSCR
• Connections to STR property management companies

Best For: First-time STR investors who want educational support and guidance.

5. Griffin Funding

Griffin Funding offers DSCR products suitable for short-term rentals with clear qualification paths.

Program Details:

• STR properties accepted with additional scrutiny
• DSCR minimum: 1.30 for Airbnb properties
• LTV up to 75%
• Loan amounts: $150,000 to $2.5 million
• Fixed-rate options

Requirements:

• Established STR history preferred (12+ months)
• Strong local market data
• Higher reserve requirements (18 months PITI)
• Property must be in STR-friendly jurisdiction

Best For: Conservative investors seeking stable, long-term financing for proven STR properties.

How to Qualify for STR DSCR Financing

1. Document Your STR Income

Lenders need confidence in your income projections. Provide:

For Existing STRs:

• Complete Airbnb/VRBO income history (12-24 months)
• Monthly breakdown showing seasonal patterns
• Occupancy rate data
• Average daily rate (ADR) trends
• Gross income and net income after expenses
• Expense documentation (cleaning, maintenance, management)

For New STR Purchases:

• AirDNA market report for the specific property or immediate area
• Comparable STR performance data (similar properties nearby)
• Professional market analysis
• Conservative occupancy projections (60-70% typical)
• Detailed expense estimates

2. Obtain AirDNA or Market Analysis Reports

AirDNA Reports provide:

• Hyperlocal STR market data
• Revenue estimates based on property characteristics
• Occupancy rate projections
• Seasonal demand patterns
• Competitive landscape analysis
• Regulatory environment overview

Cost: $20-50 for single property report (invest in this)

How to Use:

• Order report specific to your property address
• Review conservatively—use 70-80% of projected revenue for DSCR calculation
• Share complete report with lender upfront
• Highlight key metrics: projected revenue, occupancy %, ADR

3. Understand STR DSCR Calculation

DSCR for short-term rentals requires careful calculation:

Formula: DSCR = Monthly Gross STR Revenue ÷ Monthly PITI Payment

Example Property:

• Purchase price: $400,000
• Down payment (25%): $100,000
• Loan amount: $300,000
• Interest rate: 8.0%
• Monthly P&I: $2,201
• Property taxes: $400/month
• Insurance: $150/month
• Total PITI: $2,751

Income Calculation:

• AirDNA projected annual revenue: $48,000
• Monthly average: $4,000
• Conservative adjustment (75%): $3,000
• DSCR: $3,000 ÷ $2,751 = 1.09

Problem: Most STR lenders require DSCR of 1.20-1.30

Solutions:

• Increase down payment to lower PITI
• Target higher-revenue properties
• Improve property to command higher rates
• Use most optimistic (but defensible) income projections

4. Verify STR Legal Compliance

Lenders require proof that short-term rentals are legal at your property:

Documentation Needed:

• Short-term rental license or permit
• Zoning verification letter
• HOA approval (if applicable)
• City/county confirmation of STR legality
• Compliance with local regulations (occupancy limits, parking, etc.)

Red Flags:

• Properties in areas with STR bans
• HOAs that prohibit short-term rentals
• Pending regulatory changes
• Gray-area situations without clear legal status

Best Practices:

• Research regulations thoroughly before making offer
• Contact local planning department
• Review recent regulatory changes or proposals
• Join local STR host associations for insights

5. Build Stronger Reserves

STR properties require larger cash reserves due to income variability:

Typical Requirements:

• Single STR: 12-18 months PITI
• Multiple STRs: 12 months per property
• Seasonal markets: 18-24 months

Why Higher Reserves Matter:

• Covers low-season periods
• Handles unexpected vacancy gaps
• Funds emergency repairs
• Demonstrates financial stability to lenders

Reserve Strategy:

• Maintain separate account for each STR
• Build reserves before expanding portfolio
• Track seasonal cash flow patterns
• Plan for capital improvements

STR-Specific DSCR Loan Considerations

Higher DSCR Requirements

Expect stricter DSCR minimums for Airbnb properties:

Typical DSCR Requirements:

• Long-term rental: 1.0-1.15
• Short-term rental: 1.20-1.30

Reasoning:

• Income variability requires buffer
• Regulatory risk mitigation
• Higher operating costs
• Market sensitivity

Conservative Income Calculations

Lenders apply discounts to projected STR income:

Income Haircuts:

• AirDNA projections: Use 70-80% of estimate
• Historical income: May average multiple years
• Seasonal properties: Annualize conservatively
• New markets: Heavier discounting

Example:

• AirDNA projects $60,000/year
• Lender uses $48,000 (80%)
• Monthly income: $4,000
• This builds in safety margin

Property Condition and Furnishing

STR properties must meet higher standards:

Requirements:

• Turnkey ready for guests
• Fully furnished to STR standards
• Professional photos available
• Clean, well-maintained condition
• All systems functional
• Meets local safety codes

Appraisal Considerations:

• Furniture and furnishings included in value
• "Airbnb-ready" premium may apply
• Comparable sales adjusted for STR suitability
• Market area strength weighted heavily

Regulatory Risk Assessment

Lenders evaluate regulatory environment:

Favorable Markets:

• Clear, established STR regulations
• Simple licensing process
• Active STR market with many hosts
• Municipal support for tourism
• Stable regulatory environment

Challenging Markets:

• Uncertain or changing regulations
• HOA restrictions
• Neighborhood opposition
• Recent or pending STR restrictions
• Complex compliance requirements

Research Resources:

• AirDNA regulatory tracking
• Local host forums and groups
• Municipal planning department
• STR attorney consultations
• Host advocacy organizations

Maximizing Your STR DSCR Application

1. Build STR Operating History

If possible, operate the property as an STR before financing (or provide history of current STR):

Benefits:

• Proven income data beats projections
• Demonstrates your management capability
• Shows understanding of market
• Reduces lender risk perception

Timeline:

• 6 months history: Minimum for consideration
• 12 months: Strong application
• 24+ months: Excellent, shows full seasonal cycle

2. Professional Property Management

Using established STR management companies strengthens applications:

Advantages:

• Professional income projections
• Track record of success in market
• Operational expertise
• Lender familiarity with reputable managers

Top STR Management Companies:

• Vacasa
• Evolve
• TurnKey Vacation Rentals
• Local boutique STR management firms

Cost: 15-30% of gross revenue typically

3. Property Optimization

Enhance property to maximize revenue and DSCR:

High-ROI Improvements:

• Quality furnishings and décor
• Smart home features (smart locks, thermostats)
• Amenities (hot tub, game room, unique features)
• Professional photography
• Excellent reviews and ratings

DSCR Impact: Each $100/month in additional revenue increases DSCR proportionally.

Example:

• Current monthly revenue: $3,500
• Current PITI: $3,000
• Current DSCR: 1.17
• Add $300/month through improvements
• New revenue: $3,800
• New DSCR: 1.27 ✓

4. Choose the Right Markets

Some STR markets finance more easily:

Lender-Friendly STR Markets:

• Established resort areas (beach, mountain, desert destinations)
• Markets with 5+ years of strong STR data
• Areas with clear, supportive regulations
• Diversified tourism (not dependent on single attraction)
• Strong year-round or predictable seasonal demand

Examples:

• Gatlinburg/Pigeon Forge, TN
• Gulf Shores, AL
• Scottsdale, AZ
• Outer Banks, NC
• Lake Tahoe, CA/NV
• Destin/Panama City Beach, FL

Challenging Markets:

• Urban markets with restrictive STR laws
• New or unproven STR destinations
• Markets with regulatory uncertainty
• Over-saturated STR markets
• Areas with declining tourism

Common STR DSCR Loan Mistakes

Mistake 1: Using Overly Optimistic Projections

Problem: Using peak-season revenue or best-case AirDNA numbers.

Reality: Lenders will discount aggressively; you may not qualify.

Solution: Use conservative 70% of projections; demonstrate realistic understanding.

Mistake 2: Ignoring Operating Expenses

Problem: Calculating DSCR on gross revenue without considering STR expenses.

Reality: While DSCR uses gross revenue, you need positive cash flow after expenses.

STR Operating Expenses:

• Cleaning fees: $50-150 per turnover
• Management: 15-30% of gross revenue
• Utilities: Higher than long-term rentals
• Maintenance: More frequent due to heavy use
• Supplies: Linens, toiletries, cleaning supplies
• Software/subscriptions: Channel managers, smart locks, etc.

Typical STR Expense Ratio: 40-60% of gross revenue

Example:

• Gross monthly revenue: $4,000
• PITI payment: $2,800
• DSCR: 1.43 ✓ (qualifies)
• Operating expenses (50%): $2,000
• Net operating income: $2,000
• Actual cash flow: $2,000 - $2,800 = -$800/month

This property has adequate DSCR but negative cash flow!

Mistake 3: Not Verifying STR Legality

Problem: Assuming STRs are legal without confirming.

Consequence: Loan denial after wasted time and money.

Solution: Verify before making offer:

1. Check municipal code
2. Contact planning department
3. Review HOA restrictions
4. Consult STR attorney if uncertain
5. Obtain written confirmation of legality

Mistake 4: Underestimating Seasonal Impact

Problem: Using average monthly revenue without considering seasonality.

Reality: Beach houses may generate 70% of annual income in 3 months.

Impact on Cash Flow:

• High season: Strong positive cash flow
• Shoulder season: Break-even
• Off season: Negative cash flow (reserves cover)

Solution:

• Build 18-24 month reserves
• Model cash flow month-by-month
• Plan for seasonal fluctuations
• Consider year-round markets for more stability

Mistake 5: Overleveraging

Problem: Financing multiple STRs with minimum down payments and slim reserves.

Risk: Market downturn or regulation change affects entire portfolio.

Conservative Approach:

• Start with 1-2 properties
• Build substantial reserves per property
• Diversify across markets
• Maintain 25-30% down payment
• Prove concept before scaling

The Future of STR DSCR Financing

Regulatory Evolution

STR regulations continue evolving:

Trends:

• More cities implementing registration/licensing
• Occupancy limits and safety requirements
• Increased taxes and fees
• Primary residence requirements in some areas

Lender Response:

• More sophisticated regulatory risk assessment
• Premium pricing for uncertain markets
• Preference for clearly legal jurisdictions

Data Sophistication

Lenders are using better data:

Improvements:

• Integration with AirDNA, Transparent, AllTheRooms
• Automated market analysis
• Real-time regulatory tracking
• Competitive landscape evaluation

Impact: More accurate income projections and risk assessment

Portfolio STR Products

Lenders developing specialized portfolio programs:

Features:

• Financing for multiple STRs
• Portfolio-level DSCR calculation
• Cross-collateralization options
• Relationship pricing

The Bottom Line

Financing Airbnb and short-term rental properties through DSCR loans is absolutely viable with specialized lenders like Visio Lending, Lima One Capital, Anchor Loans, JCAP Private Lending, and Griffin Funding. These lenders understand the unique economics and risks of short-term rentals and have developed underwriting processes to evaluate STR income appropriately.

Keys to Success:

1. Document income thoroughly: Historical data or strong AirDNA reports
2. Verify legal compliance: Confirm STR legality before proceeding
3. Build substantial reserves: 18-24 months for seasonal properties
4. Use conservative projections: 70-80% of estimated revenue
5. Target lender-friendly markets: Established STR destinations with clear regulations
6. Demonstrate expertise: Operating history or professional management
7. Maintain strong DSCR: Target 1.25-1.30 minimum

The short-term rental market offers exceptional return potential for real estate investors, often generating 2-3x the income of traditional rentals. With the right DSCR lender and proper preparation, you can access financing that supports your STR investment strategy and helps build a profitable vacation rental portfolio.

The key is working with lenders who genuinely understand the STR business model and have processes designed to evaluate short-term rental income fairly and accurately. Choose experienced STR lenders, provide comprehensive documentation, and focus on properties in strong, legally-clear markets to maximize your financing success.