Every figure here varies by lender and program — guidelines, property type, leverage, and credit profile all apply.
The Quick Read: On a cash-out refinance, short-term rental collateral typically tops out at 70% loan-to-value (LTV, the loan as a percentage of appraised value), while 75% LTV is the ceiling for a standard long-term rental, so the program that fits depends on how the property is rented, how much hosting history you hold, and how much rental income the lender will count. The 75% in the title is real. It just belongs to a different kind of collateral. Here is what to take away:
- Across the wholesale network Lendmire places files with, cash-out on short-term rental collateral generally sits at about 70% LTV. A standard long-term rental generally sits at about 75%.
- Short-term rental files typically want a 640+ credit score and about 12 months of hosting history, subject to lender guidelines.
- Coverage of 1.00 is where select programs start on a short-term rental refinance. A stronger ratio can improve pricing, but it does not lift the LTV ceiling.
- Your loan size is the lower of two limits: the equity limit and the coverage limit.
- The best program for your situation depends on the property, your credit, your hosting records, and how much cash you need.
DSCR Cash-Out Calculator
Run the cash-out numbers in your market
Rate source: Freddie Mac 30-yr average via FRED® — Federal Reserve Bank of St. Louis · effective Oct 29, 2026
Prefilled with starting assumptions — enter your property’s value, balance, taxes, and insurance for a more accurate picture.
Program parameters update from Lendmire’s centralized guideline source. Taxes and insurance are editable estimates.
As of Oct 29, 2026 · General Freddie Mac market benchmark, not a Lendmire loan offer. Property value, balance, taxes, and insurance are editable estimates. Maximum loan-to-value varies by lender, program, property type, and seasoning. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
Why 70% and 75% Both Show Up
Most cash-out files across the network cap at 75% LTV on a standard rental. A short-term rental is a business, not a lease. Lenders see more income swing, so they pull leverage back to about 70% on short-term rental cash-out. Think of 75% as the ceiling on a standard rental and 70% as the ceiling on a nightly one. Final terms depend on lender guidelines, property type, leverage, and the borrower’s complete credit picture.
| Collateral | Typical cash-out ceiling | What drives the gap |
|---|---|---|
| Standard long-term rental | About 75% LTV | Lease-based income |
| Short-term rental | About 70% LTV | Booking-based income |
Purchases work differently. A short-term rental purchase can reach 75% LTV on the strongest files. That is probably the source of the “75% on an Airbnb” talk you hear. It describes buying, not pulling cash out. These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
These are typical guideline ranges from select wholesale lenders. They are not promises. Every file is underwritten individually. This is not a commitment to lend.
How a Short-Term Rental Cash-Out Refinance Works at 75% LTV
Terms depend on the lender’s guidelines, the property type, the leverage, and a full review of the credit profile.
The mechanics run in six steps. Understanding them tells you which lever to pull.
Step 1: The lender classifies the file. If any cash comes back to you at closing, it is a cash-out refinance. That carries tighter leverage and a seasoning expectation (the time you must have owned the property). Around 6 months of ownership is common across the network. A rate-and-term refinance, which only swaps the old loan for a new one, is treated more gently.
Step 2: The lender establishes qualifying income. DSCR loans are business-purpose loans designed for non-owner-occupied investment properties, so they are reviewed differently from a standard owner-occupied mortgage. The borrower qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. For a short-term rental, income comes from one of three places: your trailing platform history, an appraiser’s short-term rental analysis, or a market projection from a data vendor. Programs differ on which they accept.
Step 3: The appraisal sets value and market rent. Value drives your LTV. Market rent drives your coverage. More on why this step trips up short-term rentals in the next section.
Step 4: The lender applies a haircut. Many programs discount gross booking income before computing coverage. Bookings are not collected rent. A discount for vacancy and operating swing is common, and it varies by lender.
Step 5: The loan is sized at the lower of two limits. The equity limit is the LTV ceiling times the appraised value. The coverage limit is the discounted income divided by the full new payment. A bigger loan means a bigger payment. So thin income can shrink your cash-out even when you have plenty of equity.
Step 6: Occupancy and legality are documented. You sign a statement that you will not live in the property. 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.
The Appraisal Problem Nobody Mentions
The standard rent form was built for monthly leases, and that matters for nightly rentals. The one-unit rent schedule is Form 1007, and the small residential income report for two-to-four-unit properties is Form 1025, per the Fannie Mae Selling Guide’s appraisal forms page. DSCR loans are not agency products. Those form names are just what appraisers commonly use.
The Fannie Mae appraiser update says Form 1007 builds market rent from comparables leased monthly. It calls it incorrect to take a nightly fee and multiply it by 30. It also says the form cannot estimate a nightly fee at all.
McKissock, an appraiser-education provider, makes the same point. The form documents monthly rent, not nightly rates or business income. It adds that appraisers may need another tool, such as AirDNA, for a short-term rental estimate.
Here is what that means for you. On a short-term rental file, the appraiser typically adds a narrative income analysis next to the standard form. That quality is not standardized. A weak narrative can pull the income figure below what your bookings actually show. So the appraisal is often where the coverage limit gets set.
(Pro move: gather your platform payout reports and booking calendar before the appraiser visits.)
What the Lenders Behind These Programs Look For
Across the wholesale network, short-term rental refinance files tend to look like this:
- Leverage: about 70% LTV on short-term rental cash-out and about 75% on a standard long-term rental cash-out.
- Credit: 640+ on short-term rental files. Most programs want around 660, and 700+ unlocks the strongest leverage tiers.
- Hosting history: about 12 months of landlord or host experience is the usual expectation.
- Coverage: 1.00 is where select programs start on a short-term rental refinance. A separate select-lender path takes coverage below 1.00, with leverage and terms adjusted.
- Loan size: up to $3,000,000 on standard programs. Above $2,500,000 the network generally holds to 30-year fixed structures.
- Reserves: these vary by lender, leverage, and loan size. Around 6 months of PITIA (principal, interest, taxes, insurance, and HOA dues) is common, and larger loans typically step up.
- Structure: the 30-year fixed is the spine. Extended terms such as 40-year and interest-only periods are available through select lenders, and ARM structures exist too.
A bigger down payment or a lower balance can lift your coverage. It never erases leverage caps, credit floors, reserve rules, or property eligibility. The strongest files clear both tests: enough equity and enough rental coverage.
A Worked Example in Percentages
Say you own a vacation cabin with an existing loan around 55% of its appraised value. Assume strong credit and 12-plus months of bookings.
On short-term rental collateral at a 70% ceiling, you have about 15 points of value to work with before costs. If the same property were a standard long-term rental at a 75% ceiling, you would have about 20 points. That 5-point gap is the difference the title is really asking about.
Now test the coverage limit. Assume the lender discounts your gross bookings, and the discounted income covers the new payment at roughly 1.1x. You clear the 1.00 floor. But if the lender’s discount runs heavier and coverage lands near 0.95x, the proceeds may shrink, or the file may need a different structure. Select lenders in the network offer sub-1.00 paths with leverage and terms adjusted. Qualification stays subject to lender guidelines, credit approval, and property review.
Read that again. Equity said yes and income said “not that much.” The smaller number wins.
Clearing 1.00 is also not the same as positive cash flow. DSCR compares rent to PITIA only. Repairs, vacancy, management, utilities, and capex all sit outside the calculation. Stress-test your occupancy and nightly rate before you pull cash.
Where the General Rule Breaks
Thin or new hosting history. A borrower with only a few months of bookings finds that many programs want 12 months, use market rent instead, or limit cash-out. A few programs skip the history requirement but adjust leverage. Waiting can strengthen the file, because real bookings replace projections.
Seasoning and cost basis. Inside the seasoning window, some programs size cash-out on your cost basis instead of the appraised value. That matters if you bought low and renovated. Lenders treat renovation and recent purchases very differently.
Delayed financing. This is an exception for true cash buyers. It generally returns roughly what you paid, not after-repair value. It rarely rescues a purchase made with hard money, because that purchase carried a lien from day one.
Two-to-four-unit short-term rentals. The Form 1025 path applies, and it also does not capture nightly pricing. The same appraisal gap shows up.
Lender variance. Some lenders will not touch short-term rentals. Some qualify only on long-term rent. Some accept platform history. Some accept projections. A file that falls back to long-term rent can fail even when bookings are strong. This is the biggest practical difference between programs.
Ineligible property types. Manufactured homes (single- and double-wide), log homes, and barndominiums are not offered through the network’s DSCR programs, even when the booking numbers look great.
What Is the Best Program for Your Situation?
No single program wins for everyone. The best one for your situation depends on the property, your credit profile, how much leverage you need, and how you document income. Here is how it breaks down in practice.
You have 12-plus months of strong, documented bookings, 700+ credit, and modest leverage. Most programs in the network will take a serious look. Pricing and leverage tend to improve as coverage strengthens.
You have a short history but plenty of equity. Look for programs that accept an appraiser’s analysis or projection, and expect adjusted leverage.
You need every last point of leverage. Check whether the property qualifies as a standard long-term rental with a lease in place. Check, too, whether you can document that use honestly. Do not relabel a nightly rental to chase 75%. The occupancy and use statements you sign are real, and income from an unlawful use may not count.
This is the point of working through a broker. A broker that shops multiple wholesale lenders can match your scenario to the program whose rules fit it. Which lenders write short-term rental cash-out loans, and on what terms, varies with your property type, hosting records, credit, and leverage need. Lendmire’s complete DSCR loans guide covers the full program picture.
When you compare offers, ask for formal term sheets rather than soft quotes. Line up prepayment penalties and fee structures side by side. A prepayment penalty is a charge for paying the loan off early.
Where the Cash Goes
Many investors use cash-out proceeds to buy the next rental, renovate, or pay down higher-cost debt. Whatever the plan, document it.
Key Terms Defined
LTV (loan-to-value): The loan balance as a percentage of the property’s appraised value.
Cash-out refinance: A new loan that pays off the old one and hands you the extra cash.
DSCR (debt service coverage ratio): Monthly rent divided by the full monthly obligation, meaning principal, interest, taxes, insurance, and any HOA dues.
PITIA: The full monthly obligation: principal, interest, taxes, insurance, and association dues.
Seasoning: The time you must hold a property or a loan before a lender will treat it fully.
Haircut: A discount a lender applies to gross booking income before computing coverage.
Form 1007 and Form 1025: Appraisal forms for market rent. Form 1007 covers a one-unit property, and Form 1025 covers two to four units.
Prepayment penalty: A fee for paying the loan off ahead of schedule.
Myths That Cost Investors Cash
“The 1007 proves my Airbnb income.” It does not. The form reflects monthly lease comparables, not your nightly bookings.
“Nightly rate times 30 equals monthly rent.” The Fannie Mae appraiser update calls that method incorrect.
“DSCR means no documents.” Qualification runs on the property’s income, but you still need the appraisal, platform history, and credit.
“All DSCR lenders do short-term rentals.” They do not, and those that do treat the income differently.
“75% is the cap for every rental.” It is the cap for a standard long-term rental cash-out. Short-term rental cash-out generally tops out at 70%.
“Max LTV is a promise.” Credit, coverage, property type, and loan size all lower the real number.
“Agency rules govern DSCR loans.” They do not. The agency guides do not address short-term rental income, and McKissock notes that not all loans go through Fannie Mae.
Frequently Asked Questions
Can I get 75% LTV on a short-term rental cash-out refinance?
Generally not. Across the network, short-term rental cash-out sits at about 70% LTV, while a standard long-term rental cash-out sits at about 75%. Purchases can reach 75% on the strongest short-term rental files. Eligibility depends on lender guidelines, credit, and property review.
How much hosting history do I need?
About 12 months of landlord or host experience is the usual expectation on short-term rental files. Some programs accept shorter history with an appraiser’s analysis or projection, usually with adjusted leverage. Waiting often strengthens the file.
Does clearing 1.00 coverage mean the property cash flows?
No. DSCR compares rent to PITIA only. Vacancy, repairs, management, utilities, and capex sit outside it, so run your own stress test on occupancy and nightly rate.
What if my coverage falls below 1.00?
Coverage of 1.00 is where select programs start on a short-term rental refinance. Those files get a closer look at credit and reserves.
Will a larger down payment fix a weak file?
It helps coverage by lowering the payment, but it never erases leverage caps, credit floors, reserve rules, or property eligibility. The strongest files clear both the equity test and the coverage test.
Next Steps
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. Reach out at 828-256-2183 or request a quote. An illustrative calculator estimate is a useful first look before you talk to anyone.
For current guidelines and terms, see Lendmire’s DSCR loan programs page.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker, not a lender. It arranges DSCR investor financing through select lenders in its wholesale network across 41 markets, including Washington, D.C. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
For how equity extraction works on an investment property, see Lendmire’s guide to cash-out refinance on an investment property.
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Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. Fannie Mae Selling Guide’s appraisal forms page
2. Fannie Mae Appraiser Update (Form 1007 and short-term rentals)
3. McKissock Learning: Form 1007 and Short-Term Rental Appraisals
This article is part of Lendmire’s investment property cash-out refinance program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: DSCR Cash-Out Refinance Requirements for Funding Renovations on an Investment Property · Short-Term Rental Cash-Out Refinance Requirements on a Multifamily Building · DSCR Cash-Out Refinance Requirements on a Small Multifamily Rental at Up to 75% LTV
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.