Calculator · BRRRR
BRRRR calculator
Buy, rehab, rent, refinance, repeat. See how much cash goes in, how much the refinance gives back, what is left in the deal, and the cash flow on the new loan.
Results
Updates as you type. The formulas are under "How this is calculated" below.
- Cash left in the deal
- All cash back?
- Share of your cash returned
- Monthly cash flow after refi
- Cash-on-cash (on cash left)
- DSCR on new loan
- Meets lender minimum?
- Loan the rent supports
Before the refinance
- Acquisition loan
- Holding costs
- Total project cost
- Total cash in (yours)
- All-in cost as % of ARV
Refinance
- New loan
- Cash-out to you
- Excess cash-out beyond cash in
- New monthly P&I
- NOI (year 1)
- Equity (ARV - new loan)
How to use this calculator
- Enter the purchase price, closing costs, rehab budget and how many months until you refinance.
- Choose hard money or all cash for the acquisition. For a loan, set the loan percentages, rate and points.
- Enter the after-repair value (ARV) you expect when the rehab is done.
- Enter the rent, vacancy and operating expenses for the stabilized rental.
- Set the refinance terms: loan-to-value, rate, term and closing costs, plus your lender DSCR minimum.
- Read how much cash is left in the deal and what the rental earns on the new loan.
Worked example
Say you buy for $300,000, spend $60,000 on rehab and refinance after 6 months, with an ARV of $450,000 (the values loaded above).
The hard money loan is $270,000. Holding costs are $19,200 and total project cost is $392,100. Your cash in is $122,100.
The refinance at 75% of ARV is a new loan of $337,500. After paying off the first loan and refinance costs, you get $57,375 back.
That leaves $64,725 in the deal, and 47.0% of your cash returned.
The new monthly principal and interest is $2,245.40 and NOI is $33,375. Cash flow is about $536 a month.
Cash-on-cash on the cash left in is 9.93% and DSCR on the new loan is 1.24x.
How this is calculated
- Acquisition loan = price x loan % of price + rehab x loan % of rehab (0 for all cash). Points = loan x points %.
- Holding costs = loan x rate / 12 x months (interest-only on the full loan, conservative) + price x tax rate / 12 x months + (insurance + utilities) x months.
- Total project cost = price + closing + rehab + points + holding
- Total cash in = total project cost - acquisition loan
- New loan = ARV x refinance LTV. Cash-out = new loan - acquisition loan payoff - refinance closing costs
- Cash left in the deal = max(0, total cash in - cash-out)
- NOI uses the same operating statement as the rental calculator, with property tax on ARV. Cash flow = NOI - new P&I x 12.
- Loan the rent supports = the loan whose P&I x 12 x lender DSCR minimum equals NOI. Some lenders cap the refinance there; this page shows it but uses ARV x LTV in the math.
- Cash-on-cash = annual cash flow / cash left in the deal. When the refinance returns all your cash, the return is shown as infinite.
Frequently asked questions
What does BRRRR stand for?
Buy, rehab, rent, refinance, repeat. You buy a property that needs work, fix it, rent it out, refinance based on the new value, and use the cash you get back toward the next deal.
Can you get all your money back in a BRRRR?
Sometimes, but not always. It depends on the purchase price, rehab cost, the appraised value and the lender loan-to-value limit. If the appraisal comes in low, you may leave more cash in the deal than planned.
What is a typical refinance loan-to-value?
Many lenders cap cash-out refinances on investment property at around 70 to 75 percent of value, but limits vary by lender and loan type. Check current terms with your lender.
Why does the calculator show a loan the rent supports?
Some lenders size the loan to the rent using a minimum DSCR. If the rent supports less than ARV times the LTV, the lender may offer a smaller loan, which means less cash back.
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