BRRRR Calculator

How the model works

• Month 0 covers the purchase (net of any bridge loan), closing costs, bridge points and the rehab budget.
• Each rehab month adds holding costs and bridge interest. Seasoning months are rented, so net income offsets bridge interest.
• At refinance, the new loan (after-repair value × LTV) pays off the bridge loan and closing costs. What remains is cash returned to you.
• Cash left in deal is your remaining trapped capital. When the refinance returns everything, the return is infinite and any excess is your cash-out surplus.

Why after-repair value matters most

Small changes in after-repair value move the refinance proceeds by 70–80 cents on the dollar, so appraisal risk is the biggest threat to a BRRRR. Lenders also often require seasoning before refinancing, so leave enough months in the timeline.

Worked example

You buy a distressed property for $110,000 with a $88,000 bridge loan at 10% interest (2 points). Rehab budget: $35,000. Holding costs: $500/month. ARV: $200,000. Timeline: 3 rehab months + 3 seasoning months. Monthly rent: $1,600. NOI: $1,200/month.

Month 0: cash out $22,000 down + $1,760 bridge points + $2,200 purchase closing = $25,960. Rehab $35,000 over 3 months. Bridge interest: $88,000 × 10% ÷ 12 = $733/month × 3 = $2,200. Holding costs: $1,500 over 3 rehab months.

Seasoning (months 4–6): Collect net rent $1,200/month = $3,600. Bridge interest $2,200 on remaining balance. Net cost: −$1,400.

Refinance: ARV $200,000 × 75% LTV = $150,000 new loan, minus $1,500 closing costs → $148,500 proceeds. Bridge payoff: $88,000. Cash returned to you: $60,500.

Total deployed: $25,960 + $35,000 + $1,500 + $1,400 net holding = $63,860. Cash left in deal: $63,860 − $60,500 = $3,360 — 95% of your capital recycled. Post-refinance cash flow on a $150,000 loan at 7% (30-yr): about $350/month.

Frequently asked questions

What does BRRRR stand for?

Buy, Rehab, Rent, Refinance, Repeat. It is a real estate investment strategy where you buy a distressed property, renovate it, rent it out, refinance to pull out most or all of your invested capital, and repeat the process with the recycled cash.

What refinance LTV should I assume?

Cash-out refinances on investment properties commonly cap near 70–75% of after-repair value; some lenders offer 80% for well-qualified borrowers with strong rental income. Check current terms with at least three lenders — rates and LTV limits have moved materially since 2022.

What properties work best for BRRRR?

Distressed single-family homes and small multifamily properties (2–4 units) in markets with strong rental demand are the most common targets. The strategy works best when the purchase price plus rehab budget is meaningfully below 70–75% of ARV — that gap is your equity spread that the refinance exploits. Properties with cosmetic issues (dated kitchens, paint, flooring) have more predictable rehab costs than structural problems. Turnkey properties generally don't work: if the price already reflects full ARV, there is no equity to pull out at refinance.

What is seasoning and why does it matter?

Seasoning is the waiting period a lender requires between purchase (or last title transfer) and a cash-out refinance. Most conventional investment property lenders require 6–12 months; some DSCR lenders will refinance after 3–6 months. The seasoning period is when you collect rent but still carry your bridge loan — the longer it runs, the more bridge interest erodes your returns. Model it honestly in the timeline field above.

What is a good cash-on-cash return after refinancing?

A common target is 6–10% cash-on-cash on the capital left in the deal after refinance. If you successfully recycle nearly all your capital (cash left in deal near $0), cash-on-cash approaches infinity — but you still own a property with a loan payment and ongoing expenses. Focus on monthly cash flow and DSCR: you need the rental income to cover the new mortgage, property taxes, insurance, and a maintenance reserve.

How does BRRRR differ from fix-and-flip?

Fix-and-flip is a one-time transaction: buy distressed, renovate, sell for a profit. BRRRR is a hold strategy: buy distressed, renovate, rent, refinance, and keep the asset for long-term cash flow and appreciation. Fix-and-flip generates a lump-sum taxable gain; BRRRR creates an ongoing income stream and deferred capital gain. The refinance in BRRRR is not a taxable event — you are borrowing against your equity, not selling.

Formulas last reviewed October 3, 2026. Results are estimates for educational use; not financial advice. Methodology →