Calculate a BRRRR deal: cash left in the deal after refinancing, capital recovered, cash flow, cash-on-cash return, and the 70% max purchase price.
BRRRR Formula
A BRRRR deal comes down to how much of your own money you get back when you refinance. The core figure is the cash left in the deal:
Cash Left = Cash Invested - (New Loan - Loan Payoff - Refi Costs)
The new loan is set by the after repair value and the lender loan to value limit:
New Loan = ARV * (LTV / 100)
Once you know the cash left in the deal, the cash-on-cash return compares your yearly cash flow to that trapped cash:
Cash on Cash = Annual Cash Flow / Cash Left * 100
The maximum purchase price mode uses the 70 percent rule:
Max Price = ARV * (Rule / 100) - Rehab
The capital recovery mode rearranges the first formula to solve for the appraised value you need to pull all of your cash back out:
ARV Needed = (Cash Invested + Loan Payoff + Refi Costs) / (LTV / 100)
Variables:
- Cash Invested is your own money in the deal, meaning the down payment or full price plus purchase closing, rehab and holding costs
- New Loan is the refinance loan amount
- Loan Payoff is any short-term or purchase loan the refinance clears, which is zero for a cash purchase
- Refi Costs are the refinance closing costs
- ARV is the after repair value, the appraised value once the rehab is finished
- LTV is the lender loan to value cap on a cash-out refinance, usually 70 to 75 percent
- Annual Cash Flow is yearly rent minus operating expenses and the new mortgage payment
- Rule is the percent of ARV used as a buying ceiling, classically 70
Pick what you want to solve for at the top of the calculator. The full deal mode takes your buy, rehab and refinance numbers and returns the cash left in the deal, the capital recovered, the equity after refinancing and, if you enter rent, the monthly cash flow and cash-on-cash return. The maximum purchase price mode works backward from ARV and rehab to a safe offer. The capital recovery mode tells you the appraised value the property must reach for the refinance to return every dollar you put in.
BRRRR Refinance Benchmarks
Use the first table to read your result. The cash left in the deal and the share of capital you recover tell you how repeatable the deal is.
| Cash left in deal | Capital recovered | What it means |
|---|---|---|
| Below zero | Over 100% | You pull out more than you put in. The return is infinite and you have extra cash to redeploy. |
| Zero | 100% | Full recovery. You own a cash-flowing rental with none of your own money left in. |
| 5% to 20% of cash in | 80% to 95% | A strong result in a higher-rate market. Most of your capital is freed to reuse. |
| Over 20% of cash in | Under 80% | A capital-heavy deal. It can still cash flow, but it ties up money you cannot recycle. |
The refinance itself is limited by how long you have owned the property, called the seasoning period, and by the lender loan to value cap. These vary by lender type and directly change how much cash you can pull out.
| Lender type | Typical seasoning before cash-out | Common max LTV |
|---|---|---|
| Conventional (Fannie Mae, Freddie Mac) | 12 months (raised from 6 in 2023) | 75% single unit, 70% for 2 to 4 units |
| Portfolio or local bank | 6 months | 70% to 75% |
| DSCR or private | 3 to 6 months, sometimes none | 70% to 75%, up to 80% on strong files |
Seasoning is the time you must own the property before a cash-out refinance is based on the new appraised ARV instead of your purchase price. Shorter seasoning lets you recycle capital faster but often comes with a lower LTV, which leaves more cash in the deal.
Example Problems
Example 1: A full cash deal.
You buy a distressed house for $120,000 in cash, spend $3,000 on purchase closing, $35,000 on rehab and $4,000 on holding costs. Your total cash invested is $162,000. After the work it appraises at an ARV of $230,000, and your lender refinances at 75 percent for a new loan of $172,500. After $4,000 in refinance closing costs you pull out $168,500.
Cash Left = 162,000 – (172,500 – 0 – 4,000) = -$6,500. You recover about 104 percent of your cash, so you have nothing left in the deal and a small amount back in hand.
Example 2: A maximum offer using the 70 percent rule.
You expect the same $230,000 ARV and a $35,000 rehab and want to follow the 70 percent rule.
Max Price = 230,000 * 0.70 – 35,000 = $126,000. Paying $126,000 or less keeps 30 percent of ARV as your margin for closing, holding and refinance costs.
Frequently Asked Questions
What is a good cash-on-cash return for a BRRRR deal?
Most BRRRR investors look for 8 to 12 percent cash-on-cash after the refinance. Because the metric divides annual cash flow by the cash left in the deal, pulling most of your capital back out makes the percentage climb quickly. If you leave no cash in, the return is treated as infinite, and the monthly cash flow becomes the number that matters.
How much of my cash should I expect to get back?
The goal is 100 percent, which usually means buying at or below about 75 percent of ARV minus rehab so the refinance loan covers everything you put in. In practice, recovering 80 to 95 percent is a strong outcome in a higher-rate market. Plan to leave 10 to 20 percent of your capital in the deal and treat a full pull-out as the best case rather than the baseline.
Why does the refinance use the ARV instead of what I paid?
A cash-out refinance is based on the current appraised value, which after a finished rehab is the ARV rather than your purchase price. This only applies once you clear the lender seasoning period, often 6 to 12 months. That gap between your low all-in cost and the higher appraised value is what lets the BRRRR method return your capital so you can repeat it.
