Obtaining a house loan today may be easier than it was a few decades back, but that does not mean all properties fall under such categories.
Purchasing a residential place for renting out on Airbnb falls under the league of buying a home, and financial institutions readily accept such applications. But if you wish to rent it out on Airbnb, then you will be obstructed by the fact that your new house is not for residential purposes.
For starters, the average rent which is obtained from being on Airbnb is around $950 a month, which is quite magnificent compared to most other housing complexes. In addition, 42 million people have been registered on Airbnb all over the countries, and that number is expected to rise more.
Under such circumstances, this form of housing becomes quite convenient for people renters, and even more for people who own the place. And for that very reason, obtaining a loan for renting out a place on Airbnb right after purchase is considered to be an occupancy fraud, because the loan loses its purpose of being taken up for residential reasons.
How Then Can You Finance Your Purchase?
1. Regular Loan
A regular housing loan works fine if you are taking up the place for your own residence. It is not, however, forbidden by law for you to have renters for a few months straight at the place. When tourism in the state is at its peak, for example, you can rent out your place for good money and then move back in for the rest of the year.
Although this means that you cannot use the place for renting out for a good channel of indirect income, it gives you access to going about it both ways without going through extra efforts or paperwork. In other words, it’s smart and simple, but a less rewarding solution.
2. Purchasing as an Investment
Investing in real estate usually goes something like this: you buy the property, keep it on rent or live there, and sell it when the price in the market becomes high. So if the financial institution you are seeking help from sees that you have taken up the property for investment purposes, it may hold you back.
However, by getting a loan cleared under such a heading you can still defend it by revolving your case around your need to do so or the calling of the hour. If you get your loan cleared, then renting out the place will legally pose no problem.
3. Personal Contacts
These forms of loans are not documented by institutions themselves, because they can be granted to you by friends and families. Though the question of legitimacy and trust are relatively easier to answer in this case, finding such a member in your close circle can be rather difficult. But if you have someone in mind, don’t let the opportunity slip by!