STR: What to ask Your Lender First!

Dated: March 25 2025

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As you may or may not know, securing financing for a short-term rental (STR) isn’t the same as getting a traditional mortgage. Lenders look at different factors—cash flow, market trends, and STR-specific risks. Asking the right questions upfront can make all the difference.

 

Before you apply, make sure you ask your lender:

✅ Do you offer loans tailored for STRs? Not all lenders understand the STR model—make sure yours does.
✅ What income will you consider for qualification? Some lenders factor in projected STR revenue, while others don’t.
✅ Are there prepayment penalties? Flexibility matters if you plan to refinance or sell, but luckily, this however does not apply in ALABAMA! 
✅ What are the down payment & reserve requirements? STR-friendly loans often have different criteria than traditional investment loans.

 

The right financing can maximize your returns and set you up for long-term success. Lucky for you, we partner with trusted LOCAL lenders who specialize in the STR space to close deals in our destination.

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Jordan Bodenhamer

As a 4th generation native of Baldwin County, born and raised in Gulf Shores, AL., and as a family member (as well as a 20 year employee) of one of the longest standing family-owned Vacation Rental Ma....

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