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Can You Get a DSCR Loan on a Condotel? The Exclusion Most Lenders Won’t Mention

Yes — but fewer lenders than you’d think. A “condotel” (a condo unit in a hotel-like building with rental management and short stays) is excluded by many DSCR programs over warrantability and project-review concerns. A minority of STR-specialist lenders fund them; the trick is matching to that subset.

What counts as a condotel

A condotel is a condominium unit in a building that operates like a hotel — short stays, an on-site rental/front desk, daily housekeeping, and often commercial space. Many resort and beach “condos” are technically condotels, which matters enormously for financing.

Why so many lenders exclude condotels

Condotels often fail conventional condo-warrantability tests (transient occupancy, on-site rental desk, commercial components, low owner-occupancy). Because the project profile is riskier and harder to resell, many DSCR programs simply exclude them. The lenders that do fund condotels run their own project review and price an overlay for it.

A worked DSCR example

Condotel economics can still pencil: high nightly revenue in a resort market often offsets the rate overlay and any HOA. The catch is the HOA — condotel dues are typically higher and are part of PITIA, so model them in. The engine includes a higher HOA assumption for condotels so your DSCR isn’t flattered.

Who funds them — find them up front

Run the engine with property type set to “condotel” and the match filters to the lenders whose terms allow it, so you see the real (smaller) match set — not a list that quietly drops your file at underwriting. If zero match at your ratio, we surface the closest-miss programs and the blocker.

Frequently asked questions

Can you get a DSCR loan on a condotel?

Yes, from the subset of STR-specialist lenders that allow condotels — many DSCR programs exclude them. Filtering to condotel-friendly lenders up front avoids a late decline.

Can I get a DSCR loan on an Airbnb with no rental history?

Yes. 9 of the 10 STR lenders we track qualify the loan on a market revenue projection (AirDNA/Rabbu) or an appraiser’s Form 1007 short-term-rent schedule, so no operating history is required for many programs.

What down payment and LTV do STR DSCR loans require?

Most STR DSCR programs want 25–30% down (70–75% LTV) — slightly more than a long-term-rental DSCR loan, reflecting the variability of nightly income. A stronger cap-adjusted DSCR and credit band can unlock the higher-LTV tier.

What DSCR do STR lenders require?

Most set a floor around 1.0 on the cap-adjusted DSCR (revenue ÷ PITIA). Some offer no-ratio or sub-1.0 STR programs at a premium for thinner deals. The engine shows your ratio against each lender’s specific floor.

Are you a lender or a broker?

Neither. NightYield is a marketing and lead-referral service. We don’t originate, quote, or negotiate loans — we compute the feasibility truth and, if you ask, connect you with STR lenders who fund Airbnb income.

How current is this information?

Revenue and rate figures render from the data layer with an “as of” date; STR legality is re-checked on a monthly minimum and on ordinance events, because stale legality is worse than none. Every status shows when it was last checked and a source to verify.

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