Short term rentals can be highly lucrative for investors. In fact, the number of short term rentals on the market has increased by more than 100% in the past three years. Investors are even making up to $7,000 per month on just one vacation rental property in some cities.
But qualifying for a traditional mortgage loan can be very difficult and tedious, which makes it challenging for investors to gather funds for their rentals and get the help they need.
At Kram Capital, we aren’t like other lenders. We know how to assess the viability of short term rental properties on the market and offer dedicated financing for these investments. Vacation home lending is easy with us, enabling you to potentially profit from your rental investments.
OUR SHORT-TERM RENTAL LOANS
At Kram Capital, our short term rental loan program is built for purchasing single-family homes, condos, duplexes, and other VRBO, Airbnb rentals, and vacation rental properties. Our loan terms for short term rental properties are flexible and applying has never been easier.
Benefits:
| No W-2s or tax returns required | Loans up to $3 million |
| New investors welcome | Flexible loan terms |
| Fast closings | Low, fixed interest rates |
SHORT TERM RENTAL FINANCING SIMPLE
Our program for short term rental properties is streamlined and painless. There’s no jumping through hoops, which means we don’t require personal income, investor experience, or lease agreements. Loans for short term rental real estate are processed efficiently and at top-speed.
The details:
- Property types allowed: Single-family homes, condos, townhomes, duplexes, triplexes, quadplexes
- Locations available: All states except ID, MN, ND, NE, NV, OR, SD, UT, VT
- Loan term options: 5/1 ARM (no balloon note), 7/1 ARM (no balloon note), 15-year fixed-rate, 30-year fixed-rate, 10-year Interest Only
- Loan sizes: $200,000 to $3,000,000
- Interest rates: Starting at 4.500%
QUALIFYING FOR OUR SHORT-TERM RENTAL FINANCING
We know that no two investors are alike, so we proudly offer flexible Airbnb and VRBO financing options that fit a variety of properties and scenarios.
Our qualifying standards vary by credit score and loan amount, but our minimum requirements are as follows:
| • Credit score | At least 680 |
| • Loan-to-value ratio | Max 80% |
| • Down payment | Minimum of 20% down |
| • Minimum loan amount | $200,000 |
The Kram Capital Difference with Short Term Rentals
Fast Closings
Time is critical in short term rental financing, which is why we offer fast and reliable closings. We are upfront from the beginning so you can plan the next phase of your investment strategy.
Personalized Service
From applying to closing, we work with you each step of the way so you always know where your short term rental loan stands.
Flexible Options
Countless loan programs available nationwide. Our robust lender network caters to all types of commercial real estate investors.
Tangible Results
Expect exceptional results as we help you grow your portfolio, and ultimately, your short term rental business.
Vacation Rental: Short Term Rental Financing FAQ
How do you determine if my short term rental property is eligible for financing?
The specific short term rental properties you’ve selected for vacation rental play a significant role in your ability to secure a short term loan. At Kram Capital, we utilize a professional appraisal service, local rent data, and review the viability of your vacation rental as an investment for cash flow. We do not require proof of income.
Can I use short term rental income to qualify for my property loan?
When it comes to applying for financing for your Airbnb, VRBO, or another vacation rental property, we don’t require proof of monthly income. This applies to short term rental financing for an Airbnb rental or VRBO rental.
We are currently building a product that would enable borrowers to use short-term rental income to qualify for both rate-and-term and cash-out refinancing.
Do you finance short term rental arbitrage projects?
Kram Capital only finances the purchase or refinance of income-producing real estate property. We do not finance arbitrage projects.
How can I improve my chances of qualifying for a short term rental?
Your best bet is to boost your credit score as much as possible. Though we require a 680 at minimum, a higher score will increase your chances of approval and, in some cases, lower your interest rate. Making a larger down payment can also help you get approved more easily.
What counts as a short term rental?
The exact definition of what qualifies as a short term rental will vary from state to state. However, in general, a short term rental is an investment property that is a furnished apartment, condo, duplex, or home that is rented for short periods of time. Whereas a long term rental is often considered to have occupancy for one month or a longer period of time, a property is considered short term if it has occupancy for one night up to one month. A long term rental and short term rental can be a lucrative investment property option and have the potential to increase your cash flow.
Can I refinance my short term rental property at a later date?
Yes, as the property owners you may refinance your short-term rental loan should you want to change your interest rate or terms or access your property’s equity down the line. At Kram Capital, we offer both rate-and-term and cash-out refinancing.
What counts as a short term rental?
The exact definition of what qualifies as a short term rental will vary from state to state. However, in general, a short term rental is an investment property that is a furnished apartment, condo, duplex, or home that is rented for short periods of time. Whereas a long term rental is often considered to have occupancy for one month or a longer period of time, a property is considered short term if it has occupancy for one night up to one month. A long term rental and short term rental can be a lucrative investment property option and have the potential to increase your cash flow.
Can I refinance my short term rental property at a later date?
Yes, as the property owners you may refinance your short-term rental loan should you want to change your interest rate or terms or access your property’s equity down the line. At Kram Capital, we offer both rate-and-term and cash-out refinancing.
Can I live in my short term rental property?
Our short term rental property loans are not designed to be used as a second home. They are designed for investment properties only. They cannot be used to finance a property you intend to live in, even temporarily. To purchase a property you would like to inhabit as a second home, you’ll want a traditional, owner-occupied mortgage. Our short term rental program is intended for a vacation rental.
Are there other options for financing a short term rental property?
While there are a few options for owners financing a short term rental property, such as hard money loans and more traditional property loans, these options typically come with high-interest rates and strict qualifying standards that take advantage of investors. Similar to traditional rental property requirements, hard money loans tend to require monthly income verification and employment verification from property owners. At Kram Capital, our short term financing program for vacation rentals and short term property rentals are more flexible, enabling property owners to qualify with simply their credit score, bank statements, and the specific property.
How can I make sure my short term rental is allowed?
As owners of a short term rental such as with Airbnb or VRBO, you’ll want to check the home vacation rental and short-term rental regulations within your city. Some cities require specific licensing and some have banned vacation rental homes as short term rentals altogether. Additionally, some cities have requirements on the occupancy/number of guests that can stay in the home. It’s always a good idea to do your due diligence prior to purchasing a vacation rental home.
Are short term rentals a good investment?
Yes, short term rentals can be a very lucrative investment and can help to increase your income. The most challenging part for investors is often coming up with the money to finance the purchase of the rental. But luckily at Kram Capital, our financing program gives you the money you need to get started with your rental property, enabling you to put your best foot forward in your new venture.
What insurance will I need as a short term rental investor?
If you’re listing vacation rentals on the Airbnb rental platform or VRBO, you’ll receive built-in “host protection.” However, as owners of these home vacation rentals, you’ll also want to consider purchasing a separate insurance policy for the full replacement cost of the property.
Get The Short Term Rental Financing You Need Today
Kram Capital understands the unique challenges that investors face when building their short-term rental businesses. Our lending platform aims to simplify Airbnb, VRBO, and vacation rental property financing and make growing your portfolio easier, faster, and more flexible. Whether you’re looking to purchase a new property or refinance an existing one, we’re here to help.
Based in Atlanta, Georgia, our nationwide reach connects clients with funding for the best commercial and residential real estate investment opportunities across the United States. Our clients benefit from flexible financing terms and competitive market rates while enjoying personalized service with the right amount of support based on their needs.
Contact Us To Learn More About Your Short Term Rental Property Financing Options
(470) 447-2077
info@kramcapital.com