What you Need to Know About Arizona Airbnb Loans

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What you Need to Know About Arizona Airbnb Loans

Airbnb has become very popular for both travelers and Airbnb hosts. Find out how to obtain your first Arizona Airbnb Loan so that you can get into this growing segment of real estate investing.

Airbnb has become very popular. Since 2017, all leisure travelers have booked 25% of their stays at an Airbnb rental property. There are over 4 million listings in more than 191 countries. These numerous travelers who are eager to stay at an Airbnb represent a good opportunity for people to generate extra income by renting out a house, condo or other space. On average, hosts make $924 a month. Some hosts have made enough to even quit their jobs. You need to remember that there are costs associated with Airbnb such as increased insurance, paying commission to Airbnb, cleaning costs and restocking costs associated to get the property ready for the next guest.

If you desire to become an Airbnb host, you will need an Arizona Airbnb Loan. One of the obvious costs required when becoming an Airbnb host is the property itself. A decision you will have to make is whether you will buy or rent a property to list on Airbnb. You will need to talk with your CPA to review your tax situation. If you are renting out your personal home, after 14 days you will need to report this income. If the property is not your primary residence, then you will need to report this as rental income.

Commission charged by Airbnb to process payments is an additional cost. This reduces your profit margin. Lastly the supplies, cleaning, and insurance of the rental property before the next guests arrive are additional costs that will lower your profit margin.

Financing Challenges for Airbnb

All these costs add up quickly and will require that you shell out thousands of dollars before the first guest is booked. Financing for people operating an Airbnb is difficult. One reason is that banks are reviewing the financing of Airbnb properties and not sure how to classify them if they are to be used as a rental property. Mortgages for rental properties have been viewed by banks as a highly risky loan. As far as a home equity line of credit, banks will not lend on a property that is used for Airbnb.

Local laws and ordinances also can be challenging. Some cities outlaw the use of homes as an Airbnb rental, so banks will not lend on them.

While Arizona Airbnb Loans through conventional lenders may be difficult, there still are possible financing options. In recent years, companies offering small business loans have popped up. An example of one is Payfully. While they do not finance property purchases, they do purchase Airbnb reservation receivables. Payfully will deduct a fee for this service and this will need to be calculated in you forecasted profit. This is an expensive additional expense. Airbnb also offers an early payout with a one percent fee. There are also companies that will advance on credit card payments which is, again, a very expensive option. If you are seeking to get your foot in the door as an Airbnb host, obtaining an Airbnb loan may be challenging, but there are options to assist you. At Level 4 Funding, we have provided capital to an extensive list of Airbnb hosts. Call us for a no-obligation quote.

Dennis Dahlber Broker Ri CEO Level 4 Funding LLC
Dennis Dahlberg


Level 4 Funding LLC 
Hard Money Lender

Hard Money Loans

Hard Money Loan

Arizona Tel:  (623) 582-4444

Texas Tel:      (512) 516-1177


Dennis Dahlberg Broker/RI/CEO

NMLS 1057378 | AZMB 0923961 | MLO 1057378

22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027

111 Congress Ave | Austin | Texas | 78701  

About the Author:  Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

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