The BRRRR strategy only works if the refinance returns enough capital to fund the next deal while the property still cash flows. This calculator models both halves: the all-in cost of buying and rehabbing, and the post-refinance picture including loan amount, cash returned, cash left in the deal, capital recycled percentage, NOI, cap rate, cash flow, DSCR and cash-on-cash return.
What's included
- All-in cost from purchase, closing, rehab and rehab contingency
- Equity created versus ARV
- Refinance loan amount at your LTV, net of refinance closing costs
- Highlighted cash left in deal and capital recycled percentage
- Post-refinance NOI, cap rate, mortgage payment, cash flow and DSCR
- Cash-on-cash return calculated on the capital actually left in
The two numbers that decide a BRRRR
Cash left in the deal and capital recycled percentage determine whether you can repeat. A deal that cash flows beautifully but traps $45,000 stops your next acquisition; a deal that returns 95% of your capital lets the same money work again. Everything else in BRRRR underwriting exists to move those two numbers.
Where BRRRR deals actually break
Three places: the appraisal comes in under your ARV estimate, the rehab runs over budget, or the refinance terms change between purchase and completion. Lender seasoning requirements can also delay the refinance by six to twelve months, during which you carry the property. Underwriting with a conservative ARV and a real rehab contingency is what keeps those risks survivable.
How to interpret your results
Look at capital recycled first. Above roughly 90% and the strategy is doing its job. Then check DSCR on the new loan — a cash-out refinance raises debt service, so a deal that cash flowed at purchase can turn thin afterwards. Finally compare equity created against your rehab spend: if you spent $40,000 to create $35,000 of value, the rehab scope, not the strategy, is the problem.
Key formulas
All-In Cost = Purchase + Closing + Rehab + Rehab Contingency Equity Created = ARV - All-In Cost Refinance Loan = ARV × Refinance LTV Cash Returned = Refinance Loan - Refinance Closing Costs Cash Left In Deal = Total Initial Investment - Cash Returned Capital Recycled % = Cash Returned / Total Initial Investment NOI = Annual Rent - Operating Expenses Cap Rate = NOI / ARV Cash Flow = NOI - Annual Debt Service DSCR = NOI / Annual Debt Service Cash-on-Cash = Annual Cash Flow / Cash Left In Deal
Worked example: $120,000 purchase, $40,000 rehab, $220,000 ARV
- All-in: $120,000 purchase + $3,500 closing + $40,000 rehab + 20% contingency $8,000 = $171,500
- Equity created: $220,000 ARV - $171,500 = $48,500
- Refinance at 75% LTV: $220,000 × 0.75 = $165,000
- Refinance closing costs 2.5%: -$4,125 → cash returned $160,875
- Cash left in deal: $171,500 - $160,875 = $10,625 → capital recycled 93.8%
- NOI: $1,950 × 12 = $23,400 rent - $9,000 expenses = $14,400 → cap rate on ARV 6.55%
- New loan payment at 7.5% over 30 years: $1,153.71/month = $13,845/year → DSCR 1.04x, annual cash flow $555
93.8% of capital recycled with only $10,625 left in, but DSCR of 1.04x is thin — a lower LTV would trade recycled capital for a safer cushion.
Frequently Asked Questions
What capital recycled percentage should I aim for?
Many BRRRR investors target 90–100% so the same capital funds the next deal. Lower percentages are not automatically bad if the property cash flows well, but they slow how fast you can repeat.
What if the appraisal comes in below my ARV?
The refinance loan shrinks proportionally, so more cash stays trapped in the deal. That is why conservative ARV estimates and a rehab contingency matter more than an optimistic best case.
Does a higher LTV always help?
No. A larger cash-out returns more capital but raises debt service, lowering DSCR and cash flow. The calculator shows both effects so you can choose the trade-off deliberately.
What is seasoning?
A lender requirement to own the property for a set period — often six to twelve months — before refinancing based on the new appraised value. Some programs are shorter; confirm before you buy.
Educational tool only — results are hypothetical projections from your assumptions, not financial, tax, legal or investment advice.