McAllen's short-term rental calendar does not look like a beach town's or a ski town's. Winter Texans fill the Valley from roughly November through March, families visit from Mexico for shopping and holidays, and patients and medical staff come for care at the region's hospitals. An hour and a half east, South Padre Island runs on a completely different season.
In short: LendingStreet finances short-term rentals in McAllen and across the Rio Grande Valley with DSCR loans that can qualify on projected short-term rental revenue on some programs, with no W-2s or tax returns and LLC borrowers allowed. Loans start at $150,000, the minimum credit score is 620, and purchases go up to 80% LTV with max leverage varying by program. Before you buy, confirm that city rules, the HOA and the deed restrictions allow nightly rentals at the property.
The biggest seasonal wave is Winter Texans, retirees from the Midwest and Canada who spend the cooler months in the Valley. Many stay in RV parks, but plenty rent furnished homes for one to four months. Their stays often run longer than a typical Airbnb trip, which smooths occupancy but can lower the nightly rate.
Cross-border travel is the second driver. Families from Monterrey and northern Mexico come to McAllen for shopping at La Plaza Mall and the city's retail corridors, for holidays and for family events. Medical travel to McAllen and Edinburg hospitals, business travel tied to trade across the Hidalgo and Pharr bridges and visitors to UTRGV in Edinburg round out the demand.
Texas does not have a single statewide STR permit, so the rules come from the city, the county and the neighborhood. McAllen, Edinburg, Mission and Pharr each set their own requirements, which may include registration and hotel occupancy tax collection. Rules in the Valley have been changing, so check with the city where the property sits before you rely on nightly income.
In practice, the stricter limits often come from HOAs and deed restrictions. Many newer subdivisions in north McAllen, Sharyland and Edinburg have covenants that limit leases under a set number of days or require HOA approval. Read the recorded restrictions before you make an offer, not after.
South Padre Island, in Cameron County, is the Valley's classic vacation rental market, busy in spring break, summer and holiday weekends. The city has its own short-term rental registration and hotel occupancy tax rules, and many condo towers set their own policies. Port Isabel and Laguna Vista, on the mainland side of the causeway, also draw visitors.
Coastal properties carry coastal costs. Windstorm coverage is often required and, for many properties, comes through the Texas Windstorm Insurance Association, and flood insurance may be needed in mapped flood zones. Get both quotes before you sign.
| Market | Main guests | Busy season | Key cost or rule |
|---|---|---|---|
| McAllen / Mission | Winter Texans, cross-border visitors, medical stays | November to March, holidays | City rules, HOA covenants |
| Edinburg | UTRGV visitors, medical stays | School year, graduations | HOA and deed restrictions |
| South Padre Island | Vacationers, spring break | March, summer | City STR registration, windstorm insurance |
| Port Isabel / Laguna Vista | Fishing, beach visitors | Summer | Flood zone, windstorm cover |
This example is illustrative and not a quote. An investor buys a three-bedroom home in north McAllen for $285,000 in a subdivision whose restrictions allow short-term leases. A revenue projection, which blends seasonal monthly stays in winter with shorter visits the rest of the year, estimates $36,000 a year, about $3,000 a month.
At 75% LTV the loan is $213,750. Estimated principal and interest is about $1,531. With no homestead exemption, taxes are budgeted at $545 a month, and STR insurance is $210, for a total of about $2,286. Projected revenue covers the payment at about 1.31x.
| Item | Amount |
|---|---|
| Purchase price | $285,000 |
| Loan at 75% LTV | $213,750 |
| Estimated principal and interest | $1,531 |
| Property taxes | $545 |
| STR insurance | $210 |
| Total monthly payment | $2,286 |
| Average projected monthly revenue | $3,000 |
| DSCR on projected revenue | About 1.31x |
Texas has no state income tax, so local governments rely on property taxes. A McAllen home can be taxed by Hidalgo County, the city, the school district, South Texas College, a drainage district and other units. Investors do not get the homestead exemption, so the bill after purchase is often higher than the seller's.
Look up every taxing unit on the Hidalgo County Appraisal District record and budget on the full combined rate. On a lower-priced Valley home, taxes can be one of the biggest lines in the payment.
Many Valley homes sell for less than in other Texas metros, which helps cash flow but can run into our $150,000 loan minimum. A home bought for $180,000 at 80% LTV is a $144,000 loan, just under the line. Options include a slightly higher-priced property, a fourplex, or combining several rentals into a blanket portfolio loan once you own five or more.
McAllen is inland, but tropical storms and heavy rain can cause flash flooding in parts of the Valley. Check the FEMA flood map and the drainage history of the street. Summer heat means air conditioning runs hard, and guests expect it to work, so budget for HVAC service and high summer electric bills.
Winter Texans often stay for weeks and want a full kitchen, laundry and reliable internet. Furnish for long stays, not just weekends.
Our STR DSCR program follows our DSCR basics: loans from $150,000, 620 minimum credit score, 30-year terms available and cash-out up to 75% LTV. Some programs qualify on projected revenue; others use booking history. If you are refinancing an existing Valley rental, booking history from the past 12 months is the strongest support.
Send the address, price and projected revenue through the form below, or call (877) 298-1001. We will run the annual numbers and tell you whether the property works as a short-term rental or would be stronger as a 12-month lease.
Rules come from the city, the county and the neighborhood. Check the city's current requirements and your HOA covenants and deed restrictions before buying.
Winter Texans from November to March, visitors from Mexico, medical travelers, UTRGV visitors and business travelers tied to cross-border trade.
On some programs, yes. Lenders look at the annual projection, including slower summer months.
Generally yes. Texas charges a state hotel occupancy tax, and cities can add local tax. Some platforms collect part of it.
Yes, if the property is a non-owner-occupied investment property that can legally rent short-term. Budget for windstorm and flood insurance.
At 80% LTV the loan may fall below our $150,000 minimum. A blanket loan or a fourplex can be an alternative.
Yes. Our STR refinance can use booking history, with cash-out up to 75% LTV depending on the program.
No. Our investor loans are business-purpose loans on non-owner-occupied property.
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