Exact terms depend on the lender’s guidelines, property type, leverage, and a full review of the borrower’s file.
The Quick Read: Not on a pure investment short-term rental purchase through the DSCR programs Lendmire places files with, because short-term-rental purchase leverage tops out at 75% loan-to-value (LTV) on the strongest files, which means roughly 25% down, subject to lender guidelines. The lower-down routes you hear about exist, but they belong to different products with different strings attached.
- Short-term rental (STR) purchase: up to 75% LTV, about a 640 minimum credit score, and about 12 months of hosting history.
- STR cash-out or refinance: up to 70% LTV, and the rent still has to clear the coverage test.
- Standard long-term rentals can reach higher leverage, but that is a different program with different rules.
- Second-home and owner-occupied loans can go lower on down payment, but they restrict how you rent the place.
- A bigger down payment helps your coverage ratio. It never erases credit, reserve, or property rules. Every figure here varies by lender and program — guidelines, property type, leverage, and credit profile all apply.
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.
Why Does 25% Down Show Up on Short-Term Rentals?
Final terms depend on lender guidelines, property type, leverage, and the borrower’s complete credit picture.
Lenders hold short-term rentals to tighter leverage because the income is harder to predict. Nightly revenue swings with seasons, local demand, and how well the listing is run. Documentation also varies from one host to the next. A lender that cannot lean on a signed lease asks for more equity as a cushion.
Think of the down payment as the lender’s margin for error. If bookings fall short, more of your own money sits in the deal before theirs does.
Across the wholesale network, the pattern is consistent. Purchase leverage on an STR tops out at 75% LTV, so the most common minimum down payment is about 25%. Refinances and cash-outs on STR collateral are held to 70%. Standard long-term rentals run higher, which is why investors who hear “15% down” often heard it about a different kind of property.
DSCR means debt service coverage ratio. It compares the property’s rent to its monthly housing payment. A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. Lendmire’s complete DSCR loans guide covers the basics if the term is new to you.
What Does the Network Actually Allow?
The grid below shows typical ranges on select wholesale-network programs. Your exact terms depend on your credit, the property, the loan size, and the lender. None of this is a commitment to lend.
| Scenario | Typical max LTV | Other notes |
|---|---|---|
| STR purchase | Up to 75% | 640+ score, 1.00 coverage floor |
| STR refinance or cash-out | Up to 70% | 1.00 floor on refinances |
| Standard rental purchase | 75%-80% | Select programs reach 85% at ~700+ |
| Standard rental cash-out | About 75% | About 6 months of seasoning common |
Note the scoping. The 70% ceiling belongs to short-term-rental collateral. The 75% cash-out ceiling belongs to standard rentals. Mixing them up is the most common way these numbers get misquoted. These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
Loan sizes run up to $3,000,000 on standard programs (smaller balances available through select lenders). Above $2,500,000 the network generally holds to 30-year fixed structures. One more boundary: manufactured homes, log homes, and barndominiums are not offered in these DSCR programs at all.
Where Under 25% Down Actually Shows Up
Terms depend on the lender’s guidelines, the property type, the leverage, and a full review of the credit profile.
Lower down payments live in other products. Each one trades something away.
Second-home loans. This is the route most people mean when they say low down on an Airbnb. It is a conventional product, not a DSCR loan. The usual conditions are that you occupy the home part of the year, it is a one-unit property, and no management company controls the occupancy. Lenders also generally will not count projected short-term rental income to qualify you.
The trap is what happens if the home is rented far more than you use it. It then functions as an investment property. A lender that finds the occupancy certification was inaccurate can have remedies. For a pure investor, this route usually fails on its own terms.
Owner-occupied house hacking. If you live in one unit of a two-to-four-unit building, owner-occupied financing can go much lower on down payment. You are buying a home, though, not an investment. Once you move out, or if you never planned to move in, the path closes. A pure rental purchase then moves to DSCR financing.
Standard long-term rentals. Many files land at 75%-80% LTV, and select high-leverage programs reach 85% LTV (15% down) with roughly a 700+ score. That is real. It simply does not describe a property underwritten as a short-term rental. For the standalone numbers, see Lendmire’s piece Putting 15% Down vs 25% Down on a Short-Term Rental DSCR Loan. The exact numbers vary by lender and program and follow a full review of property, leverage, and credit.
Honestly, this is where many first-time buyers get tripped up. They find a low-down headline, then discover it was written for a primary residence or a long-term rental.
How Does the Lender Count Your Rental Income?
Lenders count short-term rental income conservatively. Programs vary on what they accept, and only some lenders take STR income at all. The documentation path matters because it sets your coverage ratio, and the coverage ratio sets how much leverage you can use.
Common paths include:
- An appraiser’s short-term rental analysis.
- A 12-month property-management statement.
- Twelve months of bank statements showing deposits.
- On purchases, a market-data report that projects likely revenue.
Most lenders then reduce gross STR income by an expense factor before running the math. The haircut is the reason a short-term rental can look strong on a booking site and thin on the coverage worksheet.
The appraisal side has its own wrinkle. Form 1007 is the Single-Family Comparable Rent Schedule, and the 2-4 unit equivalent is the rent analysis inside Form 1025. Freddie Mac publishes its version of the form. Fannie Mae’s appraiser update on short-term rentals and Form 1007 describes the form as the rent estimate for a single-family investment property in conventional lending. It is a long-term-rent form. Many DSCR programs use it as a cross-check or fallback beside the STR data.
The practical point: the appraiser’s figure can differ from the booking-site projection, and a lender may use the lower number. Do not assume the projection you pitched is the number that qualifies you.
Does Putting More Down Fix a Thin Ratio?
A larger down payment lowers the monthly payment, which lifts the ratio. That part is real. But a bigger down payment does not erase leverage caps, credit floors, reserve rules, or property eligibility. The strongest files clear both tests: enough equity and enough rental coverage.
Run the numbers on a modeled purchase. These are assumptions, not market data. Say a property’s qualifying STR income, after the lender’s expense factor, produces a coverage ratio near 1.05x at 75% LTV. That clears a 1.00 floor with little room. Now put the same deal at 65% LTV. The loan is smaller by about 13%, so debt service falls by about the same proportion, and coverage rises to roughly 1.2x. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
What did that cost you? More cash at purchase. What did it buy? A cushion against a soft booking season and potentially a stronger file for the lender to review.
Here is the part competitors rarely say plainly: on a short-term rental, a higher ratio does not usually mean you can put less down. It is mostly the opposite. The income haircut makes the ratio harder to reach, so the equity requirement stays put.
One more caution. DSCR compares rent to PITIA only. PITIA is principal, interest, taxes, insurance, and association dues. Clearing 1.00 is not the same as positive cash flow. Repairs, vacancy, management fees, utilities, and capital expenses all sit outside the calculation, and on a short-term rental they are heavier than on a long-term lease.
What Do Lenders Weigh When You Put Less Down?
When a file sits at the edge of leverage, lenders look at everything else. Each of these either strengthens the file or adds to the equity you need:
- Credit score. A 640 minimum applies to STR programs. Higher tiers open stronger pricing and leverage. Across standard programs, a 620 floor exists in parts of the network, most want around 660, and 700+ unlocks the strongest tiers.
- Hosting history. About 12 months of landlord or host experience is expected on STR files.
- Coverage ratio. The strongest ratios open the best terms.
- Reserves. These vary by lender, leverage, loan size, and transaction type. About 6 months of PITIA is common. Conservative rate-term files at modest leverage under $1,500,000 can see reserves waived. Larger loans typically step up to about 9 months.
- Loan size and property type. Both can move the leverage cap.
- Source of funds. Borrowed or gifted down-payment money is reviewed program by program, and it never removes reserve, credit, or property requirements.
A lender in the network that sees weakness in one area will usually ask for strength in another. It rarely waives them all at once.
What About Coverage Below 1.00?
1.00 is where many select programs start. A separate select-lender path takes coverage below 1.00 with leverage and terms adjusted. No-ratio structures are available only through select lenders, generally for borrowers who already own a primary residence.
Notice what these loosen. They loosen the coverage test. They do not loosen the equity requirement, and they typically come with higher pricing and more cash down. If your plan is to buy with minimal equity because the ratio is weak, these programs run the opposite direction.
No Hosting History: What Then?
A first-time host buying a brand-new short-term rental has no trailing 12 months of income to document. On a purchase, the lender may fall back to projections or to long-term market rent. Some programs will not accept projections at all, which is why STR files steer toward investors with a track record.
If your history is thin, you have three realistic levers. Bring more equity, bring stronger credit, or underwrite the first deal on long-term rent and prove the STR income afterward. That last move is what makes a later refinance work.
Local rules matter too. 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.
How Do You Fund the 25%?
Most investors scale into short-term rentals by recycling cash rather than finding new cash. The real constraint on growth is usually the down payment on each deal, not qualification. A cash-out refinance on a seasoned property is the main way to release that equity.
For STR collateral, cash-out tops out at 70% LTV. On a standard rental it is about 75%. About 6 months of seasoning is the common expectation, and STR files may also want hosting history behind the property. Lendmire’s piece, Can a Short-Term Rental Cash Out on Less Than a Year of Bookings?, goes deeper on that exact question. Each figure is subject to lender guidelines and a complete review of property type, leverage, and credit.
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.
Which Path Fits You?
Pick the line that sounds like you:
- You will live in the property part of the year and rent the rest. A second-home loan may fit, with the occupancy limits above.
- You will live in one unit of a small multifamily. Owner-occupied financing can go lowest on down payment.
- You are a pure investor with cash for about 25% down. A DSCR short-term rental purchase is the direct route.
- You are a pure investor with less cash. Consider a standard long-term-rental purchase at higher leverage first, then season it and refinance.
- You have an existing property with equity. A cash-out at up to 70% LTV on STR collateral can fund the next down payment.
- Your ratio is thin. Put more down, find a stronger-documented property, or ask whether a select lender’s sub-1.00 path fits. Leverage, reserves, and pricing vary by lender and program; the final terms follow the full file review.
Waiting is a legitimate answer too. If the only way to close is a razor-thin ratio at maximum leverage on your first STR, that is a file with no margin for a slow season.
Key Terms Defined
LTV (loan-to-value): the loan amount divided by the property’s value. A 75% LTV means about 25% down.
PITIA: principal, interest, taxes, insurance, and association dues. This is the payment DSCR compares rent against.
Seasoning: the waiting period between buying a property and refinancing it, usually measured in months.
Reserves: liquid cash a lender wants you to hold after the down payment, counted in months of PITIA.
Expense factor: the percentage a lender subtracts from gross short-term rental income before calculating coverage.
No-ratio loan: a structure that skips the coverage test. It is available only through select lenders, generally for borrowers who already own a primary residence.
Frequently Asked Questions
Can I get an Airbnb loan with 15% down?
Not on a short-term rental purchase through these programs, where leverage tops out at 75% LTV. Select high-leverage programs do reach 85% LTV with roughly a 700+ score, but that applies to standard rentals. A second-home or owner-occupied loan may go lower, with restrictions on how you use and rent the home.
Can projected Airbnb income help me qualify with a smaller down payment?
It can help your coverage ratio on programs that accept projections. It does not shrink the equity requirement. Lenders typically reduce STR income by an expense factor, and the appraiser’s figure may come in lower than a booking-site projection.
Does a higher DSCR let me put less down?
Usually no. On a short-term rental, a stronger ratio mainly improves terms and your cushion. The leverage cap, credit floor, and reserves still apply. Think of coverage as opening doors within the cap, not raising the cap.
Is a second-home loan a good workaround for a rental I will mostly rent out?
Usually not. Second-home loans expect personal occupancy, typically limit the property to one unit, and generally will not count projected short-term rental income. A property that is mostly rented functions as an investment property, so the occupancy certification can become a problem.
Do I need reserves if I put 25% down?
Likely yes. Reserves vary by lender, leverage, loan size, and transaction type. About 6 months of PITIA is common. Some conservative files under $1,500,000 may see them waived, while larger loans typically step up to about 9 months.
Next Step
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. Lendmire is a mortgage broker arranging financing through select lenders in its wholesale network, with DSCR programs across 41 markets, including Washington, D.C.
The investors who get furthest on short-term rentals tend to treat the 25% as the price of admission, then spend their energy on coverage strength and cash recycling rather than hunting for a smaller check.
About Lendmire
Lendmire is a DSCR-focused mortgage brokerage, NMLS# 2371349, placing investor loans across 41 markets, including Washington, D.C. DSCR eligibility is generally reviewed by the lender around a property’s rental income rather than personal income documentation, which fits LLC-held rentals, self-employed investors, and portfolios scaling past conventional financed-property limits. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. Freddie Mac – Form 1000/1007 PDF
2. Fannie Mae – Appraiser Update on Short-Term Rentals and Form 1007
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 Much Down Payment a DSCR Loan Requires at Purchase · How to Qualify a Suburban Texas Short-Term Rental on a DSCR Loan · DSCR Loan Down Payment: 20% vs. 25% at Purchase and What Shifts
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Compliance and disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage broker and is not a direct lender, depository institution, financial advisor, or tax professional. Content in this article is general market analysis and educational information — not financial, legal, or tax advice for any specific situation. Lendmire does not guarantee loan approval; every transaction is subject to underwriting by the funding lender. Mortgage pricing and loan program guidelines are subject to change at any time without notice and vary by borrower characteristics, property type, and state regulations. Lendmire complies with Equal Housing Opportunity. Licensure verification: NMLS Consumer Access.