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Distress

STR Revenue Dropped Below Your Payment: Refinance Before You’re Forced To

If your short-term-rental revenue has slipped below the payment, act before you’re forced to. There are three real moves — refinance the rate/term, convert to a mid-term rental, or sell — and which one wins depends on your current rate and the property’s adjusted DSCR.

Act before you’re forced to

When trailing revenue dips below PITIA, time is your enemy — reserves erode and options narrow. Moving while you still have reserves and a clean payment history gives you access to better refinance terms than waiting until you’re behind. Treat a sustained dip as a trigger to run the numbers now.

The three moves

  • Rate/term refinance — if your rate is well above today’s, refinancing can restore positive coverage without pulling cash out.
  • Convert to a mid-term rental — if a cap or soft nightly demand is the cause, re-qualify on steadier 30+ day rent.
  • Sell — if neither pencils, a sale into current comps may beat carrying a negative indefinitely.

How to choose

It comes down to your current rate and the property’s adjusted DSCR. High rate + workable DSCR → refinance. Cap/demand problem → MTR pivot. Structurally underwater → sell. Run the address and the MTR pivot to see which path actually clears a floor before you commit.

Frequently asked questions

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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