BRRRR calculator
The whole strategy turns on one question: does the cash-out refinance give you your money back? This shows what is left in the deal and what it yields if the answer is no.
BRRRR calculator
Where BRRRR actually fails
Buy, rehab, rent, refinance, repeat. The strategy is elegant and the failure mode is always the same step: the refinance does not return enough to fund the next deal.
The appraisal is the whole thing
Your entire capital return depends on someone else's opinion of the after-repair value. At 75% LTV, every $10,000 the appraisal comes in short is $7,500 you do not get back. Model the deal at an ARV 10% below your estimate and see whether it still works. If it only works at your optimistic number, it is a bet on an appraisal, not an investment.
Seasoning delays the refinance
Many lenders require six to twelve months of ownership before they will lend against the new value rather than your purchase price. That is six to twelve months of capital tied up and holding costs accruing, and it belongs in your model.
Cash flow after the refinance, not before
A cash-out refinance maximises your loan, which minimises your cash flow. It is entirely possible to pull all your capital out and own a property that loses money every month. The two goals genuinely conflict, and the calculator above shows both so you can see the trade rather than discover it.
What a good outcome looks like
- All capital returned and positive cash flow. Rare, and the reason people run the strategy.
- Most capital returned, solid cash flow. The realistic good case. Leaving $10,000–$20,000 in a property that yields well is not a failure.
- All capital returned, negative cash flow. You have refinanced yourself into a liability. Take a smaller loan.
- Little capital returned. The purchase price was too high or the rehab did not add the value you expected. This is a buying problem, not a financing problem.
Guides that explain this
Written with the same engine, so every figure agrees with the calculator.
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Questions people actually ask
What does BRRRR stand for?
Buy, rehab, rent, refinance, repeat. You buy below market, renovate to raise the value, rent it, then refinance against the new value to recover your capital and fund the next purchase.
How much cash can I pull out in a BRRRR refinance?
Most cash-out refinances on investment property cap at 70–75% loan-to-value. The cash returned is that new loan minus whatever you still owe on the acquisition debt.
What is the seasoning period on a cash-out refinance?
Commonly six to twelve months of ownership before a lender will use the new appraised value rather than your purchase price. Some portfolio and DSCR lenders are shorter.
Can BRRRR leave me with negative cash flow?
Yes, and it is the most common self-inflicted problem. Maximising the refinance to recover all your capital maximises the payment. Pulling out less often produces a better property to own.