It might be easier for some Airbnb hosts to refinance mortgages under a new program. Some people will be able to use Airbnb income to pay off at least part of their mortgages.
Quicken Loans and two other lenders; Citizens Bank and Better Mortgage, will consider Airbnb income in refinancing decisions, an Airbnb press release indicates. Airbnb hosts in all 50 states will be able to reply for Quicken refinancing under the program.
The program will use data from Airbnb as proof of income for refinancing. Hosts that want to apply can learn more at this blog post. Citizens Bank and Better Mortgage only operate in a limited number of states.
Unfortunately, all three lenders will use other information when making refinancing decisions. There is also no indication that home equity loans and second mortgages will be added. That means hosts will still have to rely upon alternative means such as Payfully factoring; which provides cash advances against Airbnb bookings.
Airbnb is working with the Federal National Mortgage Association (Fannie Mae) on the mortgage plan. That indicates the federally-sponsored mortgage organization is interested in home-sharing and wants to promote the practice.
The Airbnb partnership is part of a larger effort by Fannie Mae to make new sources of mortgage credit available to cash-strapped homeowners, CNET reported. That indicates Fannie Mae might start working with other home-sharing organizations in the near future.
Airbnb is Not Going Public
Airbnb has no plans to issue stock anytime soon, despite reports it made $93 million in profit and $2.6 billion in revenue in 2017.
CEO and co-founder Brian Chesky nixed plans for an initial public offering (IPO) during the first week of February, Bloomberg Technology reported. That was a major defeat for Airbnb Chief Financial Offer (CFO) Laurence Tosi who quit after the meeting.
Tosi wanted to turn Airbnb into something like a traditional corporation. Chesky wants Airbnb to remain a gig economy organization. Belinda Johnson, an attorney will take over as Airbnb’s CFO.
The changes apparently came after Airbnb executives cashed out of $350 million in equity, Business Insider reported. Airbnb is sitting on a pile of cash including $4.4 billion in venture capital and $5 billion in the bank so it has no need for an IPO anytime soon.
There are also rumors that Airbnb has a private hedge fund that is generating around $5 million a month. Venture Beat reported that the company is putting around 30% of its cash flow into the fund, which generates cash from the company.
It looks as if Airbnb has become a moneymaking machine for its owners. One has to wonder how much of that cash Airbnb hosts will share in that cornucopia.