In California, the hardest part of a short-term rental is not the loan. It is finding a market where a non-owner-occupied nightly rental is legal. Los Angeles and San Francisco largely say no, while mountain, desert and lake towns often say yes with a permit.
In short: LendingStreet is our top pick for California short-term rental investors. We qualify on the property, not your tax returns, and on some programs we use projected short-term revenue instead of a long-term lease. LLC borrowers are standard, loans start at $150,000 with no stated maximum, and 30-year terms are available. Because many big California cities limit STRs to a host's primary residence, we focus on markets where investor-owned rentals can be permitted. Get a quote with the form below.
For investors buying or refinancing nightly rentals in California, LendingStreet is our top pick. Our short-term rental DSCR loans look at the property's income, and on some programs that means projected short-term revenue rather than a 12-month lease. There are no W-2s or tax returns to collect, and borrowing in an LLC is standard.
It fits investors buying a permitted cabin in the mountains, a desert home in the Coachella Valley or high desert, or refinancing an STR that already has a booking record. It is not for a second home you will use yourself; every loan is business-purpose financing on non-owner-occupied property.
To see your numbers, get a quote with the form below or call (877) 298-1001.
Well-known short-term rental lenders include CoreVest, Dominion Financial, Lima One and Visio Lending. Compared scenario by scenario for investors in California, LendingStreet comes out as the stronger choice, and one application covers it.
Figures for other lenders are as stated on each lender's own website as of November 2026. Lender terms change, so verify current terms with any lender before you apply. Ready to see your numbers? Use the form below or call (877) 298-1001.
| Scenario | Best fit | Why |
|---|---|---|
| A single short-term rental | LendingStreet | We finance individual 1-8 unit short-term rentals. CoreVest states its short-term rental loans are for 5+ STR properties under one loan. |
| Short-term rental with credit in the 620s | LendingStreet | Our DSCR minimum is 620. Visio Lending's STR guide states a 680 minimum, and Lima One states 700 for its STR loans. |
| Short-term rental loan above $2.5M | LendingStreet | Our DSCR loans have no stated maximum. Lima One states STR loans up to $2.5M. |
| Property in any state, including DC | LendingStreet | We lend in all 50 states and DC. Lima One states it lends across 46 states, and Dominion Financial lists 49 states plus DC. |
Rules are local, and the big coastal cities are the most restrictive. Los Angeles and San Francisco generally allow short-term rentals only in a host's primary residence, which rules out a typical investor-owned home. San Diego caps the number of whole-home licenses and has used a lottery to issue them. Many other coastal cities, and the Coastal Commission's role in coastal zones, add more layers.
Investors tend to find workable rules in mountain and desert markets: Big Bear Lake and Lake Arrowhead in the San Bernardino Mountains, Joshua Tree and Yucca Valley in the high desert, Palm Springs and parts of the Coachella Valley, and areas around Lake Tahoe and the Sierra. Even there, caps, waitlists and neighborhood limits are common. South Lake Tahoe voters, for example, restricted vacation rentals in most residential areas in 2018.
| Market | Typical approach to investor STRs | What to check first |
|---|---|---|
| Los Angeles, San Francisco | Generally primary-residence only | Usually not a fit for an investor-owned STR |
| San Diego | Licensed, with a cap on whole-home licenses | License availability before you buy |
| Palm Springs | Permitted, with neighborhood caps | Permit status and caps in the neighborhood |
| Big Bear, Lake Arrowhead | Permitted with local rules | City or county permit, wildfire insurance |
| Joshua Tree, Yucca Valley | County or town permits | Permit, septic and occupancy limits |
| Lake Tahoe area | Varies; many residential limits | City or county rules for the exact parcel |
Where STRs are allowed, expect a local permit or registration, a cap on occupancy, parking and noise rules, a local contact who can respond quickly and, in some places, an annual inspection. Permits do not always transfer with a sale, so ask the city or county whether a new owner must reapply and whether a waitlist applies.
Cities and counties levy a transient occupancy tax (TOT) on stays, and the amount is set locally. Some booking platforms collect it; in other places the owner must register and remit it. Confirm the rules with the city or county tax office before you count on a net revenue figure.
Most California investors weigh three kinds of lenders. The table compares them on what matters most for a vacation rental you plan to keep.
In California, a lender that counts only long-term rent can make a strong mountain or desert rental look unworkable on paper. Projected short-term revenue, on programs that allow it, often closes that gap.
| What matters for a vacation rental | LendingStreet | Typical local bank | Typical hard money lender |
|---|---|---|---|
| Can short-term revenue qualify the loan? | Yes, projected STR revenue on some programs | Often wants rental history on tax returns | Usually based on property value, not income |
| Income documents | No W-2s or tax returns | Usually tax returns and W-2s | Varies |
| Borrow in an LLC | Standard | Varies; often personal name | Common |
| Loan term | 30-year terms available | Varies; may be shorter or adjustable | Usually short-term only |
| Purchase leverage | Up to 80% LTV | Varies | Varies |
| Cash-out refinance | Up to 75% LTV | Varies | Rarely a long-term option |
| Where they lend | All 50 states and DC | Usually a local footprint | Often regional |
This example is illustrative and not a quote. An investor buys a permitted three-bedroom cabin in Big Bear Lake for $650,000 and puts 25% down. Property taxes are budgeted at $640 a month on the new assessed value, and insurance, including wildfire coverage, at $360. There is no HOA.
The loan is $487,500 at 75% LTV, so the down payment is $162,500 before closing costs. Estimated principal and interest over 30 years comes to about $3,409. With $640 in taxes, $360 in insurance, the monthly payment is about $4,409. Using $66,000 of projected annual revenue ($5,500 a month), DSCR is about 1.25x.
If the same home were leased long-term at $3,000 a month, DSCR would be about 0.68x, below the 1.0x standard minimum. Revenue in mountain markets swings with snow and summer weekends, so a projection should reflect this exact street and season. Programs differ in how they treat projected revenue.
| Item | Monthly figure |
|---|---|
| Purchase price | $650,000 |
| Loan amount (75% LTV) | $487,500 |
| Estimated principal and interest (30-year) | $3,409 |
| Property taxes | $640 |
| Insurance | $360 |
| HOA dues | $0 |
| Total monthly payment | $4,409 |
| Projected short-term revenue per month | $5,500 |
| DSCR on projected short-term revenue | About 1.25x |
| DSCR on a long-term lease of $3,000 | About 0.68x |
Under Proposition 13, a home is reassessed when it sells, and the general levy is 1% of assessed value plus local voter-approved bonds and special assessments. Newer subdivisions may add Mello-Roos assessments. Budget on your purchase price, not the seller's bill, which may reflect a much older assessed value.
Insurance is often the toughest line. Many insurers have pulled back from wildfire-exposed areas, and some owners end up with a state plan of last resort plus a separate policy for other risks. A short-term rental also needs coverage written for nightly guests. Get a quote before you remove contingencies and include it in your ratio.
Before you commit to any lender for a California vacation rental, get clear answers to these questions. Our answers follow.
For a California STR, the permit and the insurance quote are the two items that most often change a deal. Send both with the address and a revenue estimate, and we can tell you quickly how the numbers look.
Share the property, your revenue estimate and your target leverage, and we will come back with options. Use the form below or call (877) 298-1001.
Our top pick is LendingStreet. We qualify on the property rather than tax returns, use projected short-term revenue on some programs, lend to LLCs as standard and offer 30-year terms.
Yes. LendingStreet finances short-term rentals in California markets where non-owner-occupied STRs can be permitted, and we lend in all 50 states and DC.
On some programs, yes. The ratio can be built from projected short-term rental revenue instead of a long-term lease. The standard minimum DSCR is 1.0x, and sub-1.0 programs exist. If the projection comes in low, a long-term rent figure or a larger down payment can still make the numbers work.
No. These are business-purpose loans on non-owner-occupied investment property. We do not finance a home you live in or use as a personal residence.
Generally not. Both cities largely limit short-term rentals to a host's primary residence. Investors usually look to mountain, desert and lake markets where whole-home permits are available.
It is a local tax on short stays, set by each city or county. Some platforms collect it automatically; elsewhere the owner registers and remits it. Check with the local tax office.
Proposition 13 reassesses a home when it sells. The seller's bill may reflect a much older value, so budget on your purchase price.
It can. Insurance is part of the payment used in the ratio, so a high wildfire premium lowers DSCR. Get a quote for short-term rental use early.
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