Vacation Loan Advice

[Jesus Moreno]

Looking for help from The Vacation Rental folks. I recently went into contract on a vacation home that I obviously would like to use as an investment property, however when going through the verbal agreement phase of preparation of closing, I was asked if I would realize any income from the property. I said that I was thinking about making it a Short Term Rental (STR)… the lender said that if I do decide to use it in that way, that I would not be eligible for a vacation loan(10%) and that the loan needed to be changed to an investment property loan.

I've heard of many STR investors using the 10% loans, and it has been mentioned on the podcast several times. How are you guys getting around this? Are you listing on Airbnb and hoping the lender doesn't call the loan?

Second question many STR investors use the 10% loan but let their insurance company know the house will be a STR, does the lender and insurance company communicate with each other?