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How to Use an Airbnb Mortgage to Purchase a Rental Property

How to Use an AirBnb Mortgage to Purchase a Rental PropertyAirbnb Mortgages to Purchase Rental Property.

By now, just about everyone has heard of Airbnb. More than 10 years ago, the now-household name, debuted and forever changed how people travel.

It’s done a lot more than that, though. As it turns out, Airbnb has also given people completely new income streams.

Where many homeowners would once list their houses a couple of times year when they happened to be leaving town, nowadays, many people are purchasing second properties specifically to list them on Airbnb.

To do this, they need an Airbnb mortgage and an understanding of what to look for in the ideal property.


What Is an Airbnb Mortgage?

An “Airbnb mortgage” is just a term that commonly refers to short term vacation rental loans, the kinds of loans investors use when they want to purchase a home specifically to rent out on Airbnb. The company doesn’t actually offer any kind of financing. Instead, the term originated from just how common this practice has become. With the incredible growth of Airbnb, many investors realized that it provided an excellent avenue for new income streams. While the platform may have initially found popularity by simply giving homeowners a way to make a little extra money every now and then, many have realized the potential of buying a home specifically to rent it out on the popular site.


Generally speaking, an Airbnb mortgage will be one of the following:


  • Traditional Mortgage
  • Investment Property Loan
  • Asset-Based Loan
  • Blanket Loan


In any case, these loans will be used to purchase a property that will only ever be rented out to vacationers who find it on Airbnb.

4 Ways to Make the Most of Your Airbnb Mortgage

Long before you secure your Airbnb mortgage, you’ll need to think long and hard about the property you wish to buy with it. the right decision will make all the difference to your portfolio. Choosing the wrong one will lead to challenges as frustrating as they are expensive.

Here are four ways to pick a property that will keep your portfolio profitable.

1. Location, Location, Location

It probably goes without saying, but if you want to see big returns from Airbnb mortgage, you need to use it to buy a home where people actually want to go.

However, that doesn’t necessarily mean purchasing a property in a well-known tourist town.

Instead, think about the cities you already know well. Maybe it’s the city you currently live in or your hometown. Whatever the case, at least when you’re starting out, buy somewhere familiar. That way, you won’t make the mistake of investing in a property that might look like it has a great location on the map but will actually present all kinds of problems to your guests.

For example, Las Vegas is a great city to buy an Airbnb property because tourists are constantly traveling there. Still, if you’re not familiar with the city, you may pick a house that is in a bad neighborhood or suffers from congested traffic, making accessibility a challenge. While you should always do plenty of research, starting with a city you know will make things much easier.

2. Study Your Competition

Once you have an idea or two about where you’d like to buy your property, start using the site to research your competitors.

Given the worldwide reach of Airbnb, you probably won’t lack for competition in most towns, but that can be a good thing. A town without a lot of Airbnb options may not be a very popular place to stay.

Furthermore, looking at properties similar to the kinds you’re considering will give you a sense for what you can charge.

3. Factor in All of the Costs

Applying for an Airbnb mortgage is obviously a bit different than taking out the traditional kind.

Many investors might take out a larger loan than they otherwise would for a primary residence. Their rationalization is that they’ll soon be renting out their property and paying their monthly mortgage with a nice little profit left over.

However, remember that, just like with any business, yours is going to come with some overhead.

For example, do you plan on doing the cleaning before new guests arrive, or will you be hiring a service to handle that?

You also need to think about prolonged vacancies as you work to build a reputation on the site. Then, there are the 3% service fee Airbnb charges for every stay.

Fortunately, this kind of overhead doesn’t mean you won’t make a profit at all. You just have to consider these costs ahead of time, so you know how much home you can really afford.

4. Check Local Ordinances and Other Relevant Regulations

Every city in the country has different rules about using Airbnb to rent out your property.

For example, there are laws about how long you can allow a renter to stay. There are laws that cover how long you can rent it out without ever physically returning to the property.

Then there are other rules you’ll need to follow, like those imposed by a homeowner’s association. The last thing you want is to secure an Airbnb mortgage to buy a property only to find out that you can’t actually rent it out to guests.

So, after doing all of the above, make sure you don’t forget this final, all-important step, or you may not ever see a single dime from your investment.

Are You in the Market for an Airbnb Mortgage?

At Rental Home Financing, we would love to help you finance your Airbnb property.

In fact, we’ll finance up to 100 rental home vacation properties. Our terms include:


  • 3 years
  • 5 years
  • 7 years
  • 10 years
  • 30 years


And as investment property refinance lenders, we offer one year for cash-out.

These terms will cover single-family residences, townhomes, condos, and 1-4 unit-buildings (four-plex financing). As long as the property is worth at least $300,000 and there’s a maximum 75% loan-to-value ratio, we’ll consider your financing request. We can even help you purchase an entire apartment building.

So, if you’d like at least $250,000 for your Airbnb mortgage, our company is here to help. With more than 20 years of experience offering financing services to experienced investors, you can rely on our reputation.

Contact us today with any questions you may have or apply for your loan online right now.

Read 1679 times Last modified on Friday, 24 June 2022 02:37

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Rental Home Financing, as the best mortgage lenders we originate rental home loan products and cash out refinance investment property loans as the best investment property refinance lenders. Commercial blanket loans are available with a commercial purpose to suit your needs.

Also, as DSCR loan specialists, we are currently authorized to make such loans in most all areas of the United States. Specific circumstances will determine whether we have the ability approve/close portfolio rental home loans in your state(s). When you are ready to get a mortgage for rental property, we are ready to serve you.

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