All Forum Posts by: Zachary Koran

Yes, there are lenders that do do this. You'll want to find one that can use AirDNA projections to qualify the loan and doesn't require a full 12 months of bookings. 

What you are looking to do is go from a RTL (bridge loan) to a DSCR or other type of loan. What I STRONGLY recommend is you go with someone who provides both of these products. What we have done with our borrowers in this situation is we have given them a nice discount on the bridge (BRRR) loan if they go with us for the long term financing as well.

What you are looking to do is go from a RTL (bridge loan) to a DSCR or other type of loan. What I STRONGLY recommend is you go with someone who provides both of these products. What we have done with our borrowers in this situation is we have given them a nice discount on the bridge (BRRR) loan if they go with us for the long term financing as well.

@Zachary Koran

i think what you may be asking is - are there lenders who will loan on a property post rehab based on short term rental income?  and i think the answer to that is either totally no, or in general no.  (if anyone knows of an exception to this chime in).  

with that said, many lenders will happily lend on a rehabbed property - it's just going to be based on comps / ARV, not potential short term rental income.

but if that is not your question, let us know.

Hi Katie,

Thanks so much for the reply!

I currently run a short-term rental (STR) management business but we don't own any of the properties we manage—yet! I'm now looking to start personally investing in STRs myself.

We recently finished renovating our primary residence and are exploring the option of pulling cash out to do a BRRR strategy, ultimately landing in a short-term rental investment.

Before I do that refinance I want to look at future projects and work our way backwards to make sure we are doing this right. Does that make sense? 

Hi Zachary!

You can utilize a hard money bridge loan to kickstart a BRRR strategy with a short-term rental. HML's can finance up to 90% of the purchase price and 100% of the rehab costs, allowing you to complete the renovation with minimal capital out of pocket. Once the rehab is complete and the property is stabilized, you can refinance into a DSCR loan that allows short-term rentals (Airbnb/VRBO, etc.), depending on the location and zoning.

Keep in mind, most lenders will require a seasoning period—typically around 3 months—before you can do a full cash-out refinance, so that’s something to plan for as you run your numbers.

Do you have any experience with STRs? And where is the property located? I’d be happy to see how I could assist.