Short term rental DSCR loans at a glance
You want to know what a lender will ask before you pay for a furnished rental. The table shows typical market ranges, and each lender writes its own guidelines. Our DSCR loan requirements guide has the full checklist for standard rentals.
| Requirement | What lenders typically ask |
|---|---|
| Income they count | 12 months of booking history, a market projection, or the appraiser's long term rent |
| Booking history | Often 12 months or more from the platform's earnings records; some lenders accept less |
| Down payment on a purchase | 20% to 25% at most lenders, more for a weak ratio or a new host |
| Maximum LTV | 75% to 80% on a purchase, often lower on a cash out refinance |
| Minimum DSCR | 1.0 at most lenders, on the income they choose to count |
| Credit score | 620 to 680 minimum, 700 or higher for better pricing |
| Cash reserves | 3 to 12 months of the full monthly payment |
| Local permission | Proof of a city permit or license where one is required |
| Experience | Some lenders want a past rental before they finance a short term rental |
Market ranges as of October 2026, drawn from published lender guidelines and industry guides. Advanced Funding Solutions is a broker and does not set these numbers. The lender that funds your loan sets your actual terms.
How lenders count Airbnb income
Your bookings can swing from month to month, so a lender has to decide how much of that income to trust. A DSCR lender divides the income it accepts by the monthly payment, which covers principal, interest, taxes, insurance and any HOA dues.
Suppose bookings average $6,000 a month and the payment is $4,500. The raw ratio is 1.33, which looks strong. If the lender counts less than all of that income, the ratio falls toward 1.0. Some lenders count only a share of gross bookings to allow for vacancies, platform fees and cleaning, and the share differs from one lender to the next.
Run your own version in our DSCR calculator, then test it with a lower income figure to see how much room you have.
Booking history or a projection
If you already run the property as an Airbnb, you can show what it has earned. Lenders that rely on history usually ask for 12 months or more of earnings records from the platform. A longer record is easier to trust.
If you are buying a house that has never been rented by the night, there is no history to show. Some lenders accept a third party projection of the income the home should earn. Others skip the projection and use the appraiser's long term market rent from Fannie Mae Form 1007, which is lower but easier to document.
Why the terms run tighter than a long term rental
You are asking the lender to rely on income that depends on guests, seasons and a local permit. That risk is why some lenders lower the maximum LTV or ask for more cash in reserve.
Experience matters too. A lender that takes first time investors on a standard rental may want you to own a rental before it finances a short term one. If you hold the property in an LLC, our guide to DSCR loans for an LLC explains the guarantee and paperwork.
Check your city's rules before you buy
You can lose the whole deal if the city does not allow nightly rentals at the address you want. Many California cities limit short term rentals or require a permit, and the rules differ from one city to the next, sometimes street by street.
Rules like these are common: a cap on the number of permits, a limit on nights per year, a ban in certain zones, or a requirement that the owner live on site. We do not list individual city rules here because they change, and a rule that is out of date can cost you a purchase. Read your city's current code on its official website, and call the planning or licensing office to confirm.
Two more checks protect you. A condo or planned community can ban short term rentals in its own rules, so read the HOA documents. And a lender that sees no permit, where one is required, will usually not count the income at all.
Costs that shrink your Airbnb ratio
Your payment is only part of what the home costs to run. Most investors miss at least one of these until the first year is over:
- Insurance: a short term rental usually needs a different policy than a long term rental, and it costs more. Get a real quote before you make an offer.
- Taxes on stays: many cities charge a hotel or transient occupancy tax on nightly stays.
- Furnishing and supplies: a furnished home costs cash up front that your reserves should still cover.
- Cleaning and platform fees: these come out of the bookings before you see them.
- Property tax: California resets the tax base at purchase, so your tax line follows your price, not the seller's old bill.
When a short term rental loan is the wrong fit
If the numbers only work on the best months of the year, the loan is too risky for you. A house that needs a long term tenant to reach a ratio of 1.0 is a better fit for a standard rental loan, which has easier terms.
If your city does not allow short term rentals, no loan fixes that. And if you want to stay in the home yourself for part of the year, a DSCR loan may not allow it. A second home loan can fit that plan better.
Run your numbers with us
You do not have to sort out every lender's short term rental rules by yourself. Advanced Funding Solutions is a California mortgage brokerage that works with 100+ wholesale lenders. We find the ones that finance short term rentals and fit your property, and the lender you choose approves and funds the loan.
The first call is a few questions about the property, the bookings and what you plan to put down. Call (818) 478-2555, or request a quote online.
For the full picture on investor financing here, see our main page on DSCR loans in California.
Frequently Asked Questions
Can I qualify with projected Airbnb income instead of past bookings?
Sometimes. Some lenders accept a third party projection of what the home should earn, and others want 12 months of booking history. Lenders that do accept a projection often count only part of it, or fall back on the appraiser's long term rent.
Does a DSCR lender want to see my city permit?
Often, yes. Where a city requires a short term rental permit or license, many lenders ask for proof of it, or for a letter from the city, before they count the income.
Can I buy a house that has never been an Airbnb?
Yes, at lenders that accept a market projection or the appraiser's rent schedule. Expect a lower LTV and a larger cash reserve than you would for a standard long term rental.
Are rates higher on a short term rental than on a regular rental?
Often, yes. Lenders price in the extra vacancy and turnover risk. The gap changes with your score and how much you put down.
Can I stay in my Airbnb a few weeks a year?
Usually not much. A DSCR loan is a business purpose loan, and you certify that the home is an investment. Ask the lender about its personal use rule before you plan owner stays.
Advanced Funding Solutions Inc. is a licensed mortgage brokerage, not a lender. NMLS #1277693. CA DRE #01973518. Consumer mortgage loans are licensed in California and Florida; DSCR loans are business purpose loans. All loans are subject to credit, income, asset, property, and underwriting approval. The funding lender sets rates, terms and conditions, which can change without notice. Market ranges on this page are typical industry figures as of October 2026, not an offer or a commitment to lend. Equal Housing Opportunity.