All you're doing is transfering cash from your bank account to the property. 

I would check with more local banks, as that is probably your best option.

Quote from @Jamie Banks: I'm not familiar with the market but I've operated MTRs in a few different markets.

A tenant who fails to maintain a rental property could end up costing you more in property damage and court fees than the amount of rent they're paying you upfront. 

You don't want to bring over poor operations to STR because you will also fail there.

@Jesse Dominguez-Castelan you could get in touch with a local bank in that town and explain to them exactly what you just did here and ask them if they have a product that might help you accomplish both the buyout and the renovations.

Examples of liquid assets that can be used for a contingency fund include:Cash in a bank or savings accountStock or bond investmentsCash value of an insurance depositMoney in a 401K, IRA, or other retirement savings accountCertificates of depositLet’s say your monthly payment for a mortgage is $1,500.

We currently have a LLC that owns our existing rental property and we run the short term rental activities through this LLC with its own separate bank account.  

I would call some local, investor friendly banks and see if you can get a cash out refinance at 80 value.

Honestly, big banks have terrible rates on mortgage.Work with a broker, they are your best bet; pricing beats big banks 9 times out of 10.