Who an STR cash-out refinance is for
This loan fits investors who bought a Phoenix, Scottsdale or Tempe home, furnished it, ran it as a short-term rental and built equity through appreciation, paydown or improvements. The cash out must go to business purposes: the down payment on another investment property, a remodel, furnishing a new listing or building reserves.
It is not for a home you live in, even part of the year, and the proceeds cannot be used for personal or household purposes.
Why seasoned booking history helps
On a refinance, you can show what the property actually earned. Lenders that read short-term income typically ask for 12 months of platform payout statements or management company owner statements. A full year captures both the strong cooler months and the slower summer stretch, which gives an honest average.
If your listing has run for less than a year, the partial-year picture may look stronger or weaker than reality, because it covers only part of the seasonal cycle. Some programs will use a shorter history; others will fall back to a market-data estimate or long-term rent. Tell us how long the home has operated and which months your statements cover.
What lenders check on a Valley STR cash-out
- A current city credential. A lapsed or suspended Phoenix permit or Scottsdale or Tempe license is a red flag in any refinance file. Renew before you apply.
- Your TPT record. Lenders may ask for the license number and sometimes evidence of filings.
- Seasoning. Many programs set a minimum ownership period before they will lend against current appraised value instead of your purchase price. The period varies by lender.
- Appraisal. The appraiser values the home and, on some programs, also completes a rent analysis.
- Insurance. The policy must cover short-term rental use.
- Business purpose. You will sign a statement describing how the proceeds will be used.
Cash-out math example
Suppose your Tempe home has a current loan balance of $300,000, and a new cash-out loan of $420,000 is on the table. Payout statements average $4,700 a month. The new payment, including taxes, insurance and HOA, comes to $3,500. The ratio is 4,700 / 3,500 = 1.34.
Before closing costs, the cash out would be roughly $420,000 minus the $300,000 payoff, or $120,000. Closing costs and any prepaid items reduce that figure. If the ratio came in too low, a smaller cash-out amount lowers the payment and raises the DSCR.
Example math only, using user-style inputs. Loan amounts depend on appraisal, program limits and underwriting.
Cash-out refinance or a line of credit?
Some investors compare an STR cash-out refinance with a home equity line on the rental. Lines of credit on investment properties are less common and work very differently. Our cash-out DSCR vs HELOC comparison lays out the trade-offs in plain terms.
Start with the numbers
Gather 12 months of statements if you have them, then try the STR DSCR calculator with the loan amount you want. When you are ready, send the scenario and include your current balance, estimated value, city and HOA status.