The Quick Read: It depends on the program and the transaction. Many DSCR lenders accept an AirDNA projection on a purchase with no hosting history, a smaller group will take Rabbu, and a refinance of an operating rental usually runs on actual statements.
- AirDNA is the more commonly accepted projection source. Rabbu is accepted by fewer programs, often as a supplement.
- Projections mostly serve purchases. Operating properties and refinances lean on 12 months of real records.
- Lenders usually discount a projection before they test coverage.
- Ask which provider the lender accepts before you pay for any report.
- Clearing the coverage test is not the same as positive cash flow.
What Is the Direct Answer for a Purchase?
On a purchase with no hosting history, a projection is often the only income evidence that exists. So many programs allow one. Across the wholesale network Lendmire places files with, AirDNA is the report most programs name.
Short-Term Rental Calculator
Run the STR numbers in your market
Rate source: Freddie Mac 30-yr average via FRED® — Federal Reserve Bank of St. Louis · effective Oct 15, 2026
Prefilled with starting assumptions — enter your nightly rate, occupancy, taxes, and insurance for a more accurate picture.
Short-term rental income is documented with a 12-month history or a market data report. Program parameters update from Lendmire’s centralized guideline source.
As of Oct 15, 2026 · General Freddie Mac market benchmark, not a Lendmire loan offer. Nightly rate, occupancy, taxes, and insurance are editable estimates. Qualifying income for short-term rentals varies by program — some use appraisal market rent, others use documented STR history or projections — and is confirmed in underwriting. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
“Accepted” is a long way from “counted at full value.” The lender decides which provider it takes, how old the report can be, and how much to trim the number before dividing by the payment.
Public securitization filings show the same split. In due-diligence comments on one JPMorgan-sponsored loan pool, reviewers noted that the guidelines let either an appraiser’s rent schedule or an AirDNA Rentalizer support the income. They also noted that the guidelines defaulted to AirDNA when no actual rent was provided. Rabbu does not appear in those excerpts.
How Does a Lender Turn a Projection Into a coverage figure?
The lender divides rent used for lender review by PITIA. PITIA is the full monthly obligation: principal, interest, taxes, insurance, and any HOA dues. The result is the DSCR, the debt service coverage ratio. That ratio is the core test on any DSCR loan.
For a short-term rental on a projection, the steps run like this:
1. Pull the report on the exact address. The AirDNA Rentalizer pulls comparable active listings nearby. It projects average daily rate, occupancy, and 12-month revenue. BNBCalc’s tool guide lists the output fields, which include annual revenue, operating expenses, NOI, and cap rate.
2. Apply the lender’s discount. A haircut is the percentage a lender trims off a projection to build in caution. Each lender sets its own, which is why two lenders can quote different coverage on the same house.
3. Divide by PITIA. The trimmed figure is the rent used for lender review.
4. Check the program test. On the STR programs Lendmire places, coverage starts at 1.00 on purchases and refinances. That is where select programs begin, not a universal standard, and stronger ratios tend to open better pricing and leverage.
Some reports must also clear quality checks. Lenders commonly look at report age, the number of comparable listings, and a market-confidence score. Those settings vary by program, so your loan officer should give you the exact list before you buy a report.
Why Doesn’t the Appraisal Settle the Question?
Because the standard appraisal rent form was not built for nightly rentals. McKissock Learning explains that Form 1007, the single-family rent schedule, documents monthly rent. It does not capture nightly rates or business income, and an appraiser cannot just multiply a nightly rate by 30. The same article notes that the lender ultimately decides what income to use. Form 1025 is the 2-4 unit counterpart.
That gap is why a market-data report enters the file. The appraisal supports value, and the projection supports income. Some lenders blend the two. Others take the lower of the two figures.
Which Income Method Fits Which Situation?
| Method | Typically used for | Strength | Weakness |
|---|---|---|---|
| Actual statements | Operating STRs, refinances | Real performance | Needs history |
| Third-party projection | Purchases, no history | Works on day one | Gets discounted |
| Appraiser rent schedule | Fallback or cross-check | Independent view | Monthly rent, not nightly |
Hosting history matters beyond the income method. Short-term rental programs usually expect about 12 months of landlord or host experience, and some lenders tie projection use to that experience. A filing for another securitized pool shows a lender exception for a first-time investor’s STR that relied on AirDNA. That suggests acceptance can bend with borrower experience.
AirDNA vs. Rabbu: How Do Lenders See Them?
| Factor | AirDNA | Rabbu |
|---|---|---|
| Lender familiarity | Most commonly named | Accepted by fewer programs |
| Typical role | Primary income source | Supplement or alternative |
| Best use | Underwriting on a purchase | Early screening, second opinion |
| Before you buy | Confirm lender accepts it | Confirm lender accepts it |
The honest answer to “either or both?” is that the lender picks. If your program names AirDNA only, a Rabbu report will not substitute, however good it looks. A few lenders in the network accept Rabbu on equal footing, but you should never assume it.
Rabbu is still useful for screening. One single-property comparison by a competing tool vendor found Rabbu landing near half of actual revenue while AirDNA came close to the total. That is one house and an interested party, so treat it as an anecdote, not a verdict. The practical lesson is that different tools can produce very different numbers for the same address. Run both for your own decision-making, then give the lender the one it accepts.
Statements or Projection: Which Should You Use?
Use statements when you have them and they are strong. Use a projection when you have no history or when the lender’s program calls for one.
- New purchase, no history: Projection, often paired with the appraisal.
- Seasoned STR with strong trailing revenue: Statements. Platform payouts, property-manager reports, or bank deposits can all serve as records. A projection usually takes a bigger haircut than documented results.
- Refinance or cash-out: Statements. A projection typically does not replace history on a refinance.
- Recent conversion from long-term rental: Projection or appraisal, since the history is not yet an STR history.
An owner with history sometimes assumes they can pick the higher number. Rarely. If your actual statements come in lower than the AirDNA estimate, the lender generally sees both and leans cautious. One investor on BiggerPockets reported collecting about 80% of the AirDNA estimate on his own short-term rentals. That is one person’s experience, not a rule, but it shows why lenders do not take a model at face value.
What Does a Worked Example Look Like?
Run the numbers on a modeled property. These are assumptions for illustration, not market data. Say the AirDNA projection, before any trim, covers the monthly obligation at 1.30x. The lender applies a discount that leaves 80% of the projection counted.
- AirDNA at full value: 1.30x.
- AirDNA after an 80% factor: 1.30 × 0.80 = 1.04x. It clears a 1.00 floor, but only just.
- Lender with a steeper discount, 75%: 1.30 × 0.75 = 0.975x. Below 1.00.
- Rabbu projection modeled at 15% below AirDNA: 1.30 × 0.85 = 1.105x before the discount, and 1.105 × 0.80 ≈ 0.88x after it.
The same house produces four different answers. At 0.88x, the file is not dead, but it changes path. Sub-1.00 programs are available through select lenders in the network, with leverage and terms adjusted. Other fixes include a larger down payment, which lowers the payment and lifts the ratio, or an interest-only period through a select lender. All of it stays subject to lender guidelines and credit approval.
One caution here: clearing 1.00 does not mean the property makes money. DSCR compares rent to PITIA only. Repairs, vacancy, management, utilities, and furnishing costs sit outside the calculation. Nightly-rate businesses have more of those costs, not fewer.
Why Do Projections Get Discounted or Rejected?
Because a model sees the neighborhood, not your house. Comparable listings share a location and bedroom count, but they do not share finishes, photos, layout, or management quality. BNBCalc’s AirDNA review says property-level estimates can drift 15-30% in thin markets, even though market-level data is strong. Thin markets have few comparable listings, and the estimate leans on the few it has.
Lenders respond in a few ways: the haircut, a minimum comparable count, a report-age limit, and a market-confidence cutoff. Overstated income is a common reason an STR file gets restructured. A lender who sees a projection far above the submarket median will often tighten the file.
Short-term rental rules can vary by city, county, HOA, and property type, so investors should confirm local rules before relying on projected rental income. If short-term renting is not allowed, the underwriting can fall back to long-term market rent, and coverage can look very different.
What If Your Report and the Lender’s Disagree?
The lender’s accepted source wins. If the lender pulls its own report or relies on the appraiser’s income figure, your outside estimate is only supporting evidence. Some lenders advertise STR programs but still lean on the appraiser. A lender in a BiggerPockets appraisal-appeal thread warned of exactly that and said borrowers can appeal by submitting AirDNA data and evidence from a manager or host.
When the numbers diverge, you have three practical moves. Ask which source controls. Submit your supporting data in the format the underwriter wants. Or switch to a program built around the source you already have. Lendmire’s role as a broker is to match the file to a program whose rules fit the income evidence, which is easier than arguing with a program that does not.
What Leverage and Credit Should You Expect?
On short-term rentals, the strongest purchase files reach 75% LTV, and refinance and cash-out run up to 70% LTV on STR collateral. LTV, loan-to-value, is the loan amount as a percentage of the property’s value. Expect a credit score of 640 or better and about 12 months of host experience. Loan sizes run up to $3,000,000 on standard programs. Standard long-term rentals follow different tiers, with cash-out up to 75% LTV. Every figure is typical, not guaranteed, and each file is underwritten individually. Terms vary by lender guidelines, property type, leverage, credit profile, and full file review.
Manufactured homes, log homes, and barndominiums are not offered in the network’s DSCR programs, however well they might rent.
Lendmire’s complete DSCR loans guide covers how the ratio works across property types. For the buyer-side comparison of projections and actual host statements, see Lendmire’s piece AirDNA Projections vs Airbnb Statements for a First-Time STR Buyer.
DSCR vs. conventional financing
There are two common ways to finance an investment property, and they qualify you differently — here’s how investors weigh them.
Why investors choose it
- Qualifies on the property’s rental income — no personal tax returns, W-2s, or pay stubs needed to document income.
- No personal debt-to-income ceiling to clear, so existing mortgages and obligations don’t cap your borrowing the same way.
- Can be closed in an LLC, keeping the property inside a business entity.
- Built for scaling — not held to the limit on number of financed properties that conventional financing applies.
- Underwriting centers on the deal: generally qualifies when the rent covers the payment, a 1.00x coverage ratio being a common baseline (confirmed in underwriting).
- Designed specifically for investment property, including long-term and, where the program allows, short-term rentals.
Where it’s strong
- Often the lowest ongoing financing cost for a buyer who fully qualifies on personal income — a fit for a first property or a cost-first purchase.
Trade-offs for investors
- Requires full personal income documentation and must fit within a debt-to-income limit — salary, existing debts, and other mortgages all count.
- Typically held in your personal name rather than a business entity.
- Caps how many financed properties you can carry, which can become a ceiling as a portfolio grows.
- Evaluates you as a borrower as much as the property, which usually means more paperwork.
How investors usually choose: a first or single property often optimizes for the lowest financing cost; portfolio builders often optimize for leverage, vesting in an LLC, and scaling past conventional caps. The right answer depends on your goals, the property, and current guidelines — both paths run through select lenders in Lendmire’s wholesale network, with eligibility and terms confirmed in underwriting.
What Should You Submit?
A short checklist keeps the file clean:
- The report from the provider the lender accepts, pulled on the exact address
- Actual statements, property-manager reports, or deposit records if the property has history
- The appraisal, which supports value and gives a rent cross-check
- Proof of hosting or landlord experience, if the program asks for it
- Insurance suited to short-term use, which is its own hurdle. Lendmire’s article How to Get STR Insurance a DSCR Lender Will Accept at Closing walks through it
Which Mistakes Cost the Most?
- Paying for a report first. Ask the lender which provider it accepts, then buy.
- Assuming 100% credit. Stress-test the deal on the discounted number, not the headline projection.
- Using a screening estimate as a lender document. A free calculator estimate informs you. It does not replace the accepted report.
- Counting on a projection for a refinance. Plan on actual records.
- Confusing coverage with profit. A ratio just over 1.00 can still lose money after operating costs.
Tax treatment can depend on how the funds are used and how the property is held; investors should keep clear records and speak with a qualified tax professional before relying on any deduction.
Key Terms Defined
DSCR: The debt service coverage ratio, meaning rent used for lender review divided by the monthly obligation.
PITIA: Principal, interest, taxes, insurance, and association dues, the full monthly payment lenders test against rent.
Haircut: The percentage a lender trims from a projection before using it as income.
Rentalizer: AirDNA’s property-level report, which projects daily rate, occupancy, and annual revenue from nearby comparable listings.
Form 1007: The appraisal form that documents monthly market rent on a single-family home.
LTV: Loan-to-value, the loan amount as a percentage of the property’s value.
Frequently Asked Questions
Does a lender have to accept the AirDNA report I already bought?
No. Acceptance depends on the program, the transaction, and the report’s age and settings. A report bought before you pick a lender may be useless to that lender. Ask first, buy second.
Can I use a projection if I already host at the property?
Usually the lender prefers your actual records, since real performance beats a model. If your statements are strong, they often produce the better number. If they are weak, expect the lender to see that too.
What happens if the discounted projection falls below 1.00?
You have options, though none is automatic. Select lenders in the network offer sub-1.00 programs with leverage and terms adjusted. A larger down payment can also lift coverage. Each remains subject to credit approval and lender guidelines.
Is Rabbu useless for a DSCR loan?
Not useless, just less commonly accepted. It works well as a second data point and sometimes as an alternative source. Treat AirDNA as the safer bet for the file unless your lender confirms otherwise.
Does a larger down payment fix a weak projection?
It lowers the payment and can lift the ratio. It does not erase leverage caps, credit floors, reserve rules, or property eligibility. The strongest files clear both tests: enough equity and enough rental coverage.
If you are buying or refinancing a rental property and want to see how the numbers work, Lendmire can help you compare DSCR loan options based on the property income, credit profile, leverage, and investor goals. As a broker arranging financing through select lenders in its wholesale network, DSCR programs are available in 41 markets, including Washington, D.C., all subject to lender guidelines and not a commitment to lend.
Whichever tool you trust, the lender’s accepted source and discount decide the coverage number, so settle those two questions before you fall in love with a projection.
About Lendmire
Lendmire is a non-QM mortgage brokerage (NMLS# 2371349) arranging DSCR investor loans in 41 markets, including Washington, D.C., through wholesale and investor-lending channels. DSCR loans are evaluated by the lender on rental income rather than personal income, subject to lender guidelines — a fit for LLC-owned portfolios, self-employed investors, and operators scaling beyond conventional loan caps. Recognized as a Scotsman Guide Top Mortgage Workplace in 2025 and 2026.
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References
1. SEC EDGAR – JPMorgan ABS-15G exhibit
2. BNBCalc – Top STR calculators
3. McKissock Learning – Form 1007 and short-term rental appraisals
4. SEC EDGAR – ABS-15G exhibit, first-time-investor STR exception
5. Chalet – Airbnb calculator comparison
6. BiggerPockets – AirDNA accuracy thread
8. BiggerPockets – appraisal appeal thread
This article is part of Lendmire’s short-term rental loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: How a DSCR Lender Counts a Rabbu Projection for a Cabin Rental · How to Get the DSCR Appraisal Right on an Airbnb Converting to a Rental · DSCR Loan vs Business Loan for an Airbnb: Collateral, Recourse and Terms
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.