BRRRR Calculator

Follow the BRRRR cash bridge from acquisition to refinance

A BRRRR deal has an acquisition phase and a refinance phase. Purchase, acquisition, rehab, and holding costs form project cost before refinance. Acquisition debt is a source of funds rather than another expense, so initial cash invested equals that project cost minus the acquisition debt.

The new loan equals ARV multiplied by refinance LTV. From that loan the model subtracts the entered payoff and refinance closing costs. Only the non-negative remainder is cash returned; the calculator never treats borrowed proceeds as available before those deductions.

Reconcile cash returned, shortfall, and excess cash-out

When the refinance loan is smaller than payoff plus refinance costs, net proceeds are zero and the difference appears as refinance shortfall. That shortfall increases capital at risk. When proceeds are positive, cash returned is compared with initial cash plus any shortfall to calculate cash left in the deal.

Cash left is floored at zero. If cash returned exceeds the capital that was at risk, the remainder is reported separately as excess cash-out instead of making cash left negative. This separation makes the cash bridge auditable and avoids hiding additional borrowing inside a return denominator.

Build a consistent all-in project budget

Use acquisition costs for buyer-side transaction outlays, rehab costs for the scope needed to support the ARV and rent, and holding costs for the period through refinance. Refinance closing costs have their own field because they reduce proceeds and are also part of total project cost.

Do not count borrowed principal as both a project expense and a payoff. Acquisition debt reduces initial cash; loan payoff reduces refinance proceeds. Reconcile both amounts with the intended funding and payoff statements, particularly when accrued interest, rehab draws, or multiple liens change the balance.

Calculate stabilized NOI and post-refinance cash flow

Effective gross income equals scheduled annual rent after the entered vacancy loss plus other income. NOI then subtracts operating expenses but not financing. Annual cash flow subtracts the new loan debt service from NOI, keeping property operations separate from capital structure.

Cash-on-cash return divides annual cash flow by cash left in the deal. It is unavailable when cash left is zero because a percentage cannot use a zero denominator; cash flow, shortfall, returned cash, and excess cash-out remain visible. The calculator does not label any return as good or bad.

Stress-test appraisal, leverage, vacancy, and costs

Run lower ARV or refinance LTV cases to expose refinance risk, then change payoff and closing costs to see how cash returned moves. Separately test vacancy, rent, other income, operating expenses, and debt service so operating performance is not confused with capital recovery.

Verify title, permits, scope, lease assumptions, insurance, appraisal evidence, lender seasoning, loan terms, reserves, and payoff mechanics. The result is a scenario from entered amounts, not an appraisal, financing approval, construction estimate, or tax analysis.

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