A BRRRR calculator shows how much of your own money stays in a rental after you buy, rehab, rent it out and refinance at the new value. Formula: Refinance loan = ARV × LTV; cash left in = purchase + rehab − refinance loan; cash flow = rent − expenses − PMT(loan, rate, term). Buy at $180,000, spend $40,000, refinance at 75% of a $280,000 value and you borrow $210,000, leaving $10,000 in the deal with $102.86 of monthly cash flow at 7%.
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How to use the BRRRR calculator
- Enter the purchase price and rehab cost.
- Enter the after-repair value and the loan-to-value the refinance lender allows.
- Enter the refinance rate and term.
- Enter the monthly rent and operating expenses: taxes, insurance, repairs, vacancy and management.
The BRRRR calculator shows the refinance loan, cash left in, the new payment, monthly cash flow, cap rate on the ARV and cash-on-cash return.
What formula does the BRRRR calculator use?
- Refinance loan = ARV × LTV.
- Cash left in = purchase + rehab − refinance loan. A negative number means you pulled out more than you put in.
- Cash flow = rent − expenses − mortgage payment.
- Cap rate = (rent − expenses) × 12 ÷ ARV.
- Cash-on-cash = cash flow × 12 ÷ cash left in.
Closing costs on the purchase and refinance are not separate inputs; add them to the rehab cost.
BRRRR calculator worked example
Results from the BRRRR calculator at 75% LTV and 7% over 30 years:
| Deal | Refi loan | Cash left in | Payment | Cash flow | Cap rate | Cash-on-cash |
|---|---|---|---|---|---|---|
| $180k + $40k, $280k ARV, $2,200 rent, $700 expenses | $210,000 | $10,000 | $1,397.14 | $102.86 | 6.43% | 12.3% |
| $120k + $50k, $240k ARV, $1,900 rent, $650 expenses | $180,000 | −$10,000 | $1,197.54 | $52.46 | 6.25% | n/a |
In the second deal the refinance returns $10,000 more than you spent, so cash-on-cash cannot be calculated, but the cash flow is thin. One vacancy month would wipe out a year of it.
The refinance step
The plan depends on the appraisal and on the lender’s seasoning rules, meaning how long you must own the property before a cash-out refinance at the new value. Ask lenders about both before you buy. Run the BRRRR calculator again with a lower ARV and a lower LTV to see how much cash could get stuck.
Rental tax basics
The IRS says rental income goes on Schedule E, and you can deduct expenses such as mortgage interest, taxes, repairs and depreciation. Residential rental buildings are generally depreciated over 27.5 years under MACRS, per IRS Publication 946. The BRRRR calculator works before tax, so treat its cash flow as a pre-tax number.
Stress-testing a BRRRR deal
Change one input at a time and note how the result moves. Lower the after-repair value by 10% and see how much more cash stays in the deal. Raise the refinance rate by a full point and check whether the cash flow stays positive. Raise expenses to allow for vacancy, repairs and capital items such as roofs and water heaters. A deal that still works after these tests leaves you room for things to go wrong, which they often do with older houses.
Keep records of every rehab cost. They add to your basis in the property, which matters for depreciation and for tax when you eventually sell.
Common mistakes to avoid
Common mistakes: using a hoped-for ARV instead of one backed by recent sales, leaving vacancy and capital repairs out of the expense line, and assuming the refinance lender will lend at the highest LTV on the market. Lenders also count closing costs on the new loan, which reduce the cash you get back. Build each of these into the inputs before you decide.
Repeating the cycle
Each round adds a loan, so keep reserves for repairs and vacancies across the whole portfolio. If cash flow is near zero, a rate rise on the next refinance or a large repair can turn the property negative.
Estimates for education only, not tax, legal or financial advice. Check current rules with the tax authority or a qualified adviser.
Related converters and calculators
Related calculators:
- Rental property calculator: rental return
- ROI calculator: return on investment
- DSCR loan calculator: investor loan
Sources
IRS Publication 527: Residential rental property; IRS Publication 946: How to depreciate property; IRS Topic 415: Renting residential and vacation property.
Questions about this calculator
What does BRRRR stand for?
Buy, rehab, rent, refinance, repeat.
What LTV do refinance lenders allow?
It depends on the lender and loan type. Get a quote and enter that LTV.
What does negative cash left in mean?
The refinance returned more money than you spent buying and fixing the property.
Is cash flow after tax?
No. The calculator works before income tax and depreciation.
How long is residential rental property depreciated?
Generally 27.5 years under MACRS, per IRS Publication 946.
Check the assumptions and units before relying on a result. Financial, tax and health estimates do not replace advice for your individual circumstances.
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