BRRRR Real Estate Investment Calculator
Model purchase price, rehab budgets, cash-out refinance proceeds (75% ARV), capital recapture, and monthly net cash flow.
1. Buy & Rehab (Acquisition Phase)
2. Refinance (DSCR / Conventional)
3. Rent & Monthly Operations
Capital Recapture & Returns
$180,000
Buy + Rehab + Costs$183,750
75% of $245k ARV$750
99.6% Recaptured$469
Infinite% CoC ROIDeal Capital Structure Post-Refinance
ARV BreakdownStep-by-Step BRRRR Execution Lifecycle
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The $35,000 Infinite BRRRR: How Refinancing a Midwest Duplex Pulled 100% of Initial Capital Back in 8 Months
A real-world underwriting breakdown of forced equity creation, DSCR cash-out refinancing, and achieving mathematically infinite cash-on-cash ROI.
The Velocity of Money
Traditional real estate investing requires putting 20% down on every property, trapping capital indefinitely and bottlenecking portfolio growth. The BRRRR strategy (Buy, Rehab, Rent, Refinance, Repeat) solves this by purchasing distressed properties at a steep discount, adding forced appreciation through strategic renovation, and taking out a 75% ARV cash-out refinance. This liquidates all initial seed money while retaining title ownership and monthly positive cash flow.
The Scenario: Marcus's Columbus Duplex
Marcus finds an off-market distressed duplex in Columbus, Ohio for $130,000. It requires $45,000 in kitchen/bath renovations and roof repairs. Holding and closing costs totaled $5,000, bringing all-in investment to $180,000:
Purchase: $130,000
Rehab + Holding: $50,000
Total Cash Outlay: $180,000
Appraised ARV: $245,000
75% Cash-Out Loan: $183,750
Less $4,500 refi closing costs
Cash Left in Deal: $750 (100% Out!)
Monthly Cash Flow: +$469 / mo
CoC Return: Mathematically Infinite!
Traditional 20% Down vs. Turnkey vs. BRRRR Strategy
| Strategy | Initial Cash Outlay | Capital Left in Deal | Cash-on-Cash ROI | Time to Next Deal |
|---|---|---|---|---|
| Traditional MLS Purchase (20% Down) | $50,000 | $50,000 (Trapped) | 8.5% - 10.0% | 2 - 3 Years of Savings |
| Turnkey Rental Provider | $55,000 | $55,000 (Trapped) | 6.0% - 7.5% | 3+ Years of Savings |
| The BRRRR Method (Forced Equity) | $180,000 | $750 (Recaptured!) | Infinite% (Zero Basis) | Instant (Deploy Recaptured $183k) |
The Key Risk Guardrail: DSCR Coverage
A successful BRRRR must never sacrifice monthly cash flow for equity extraction. Always ensure your post-refinance monthly rent covers principal, interest, taxes, insurance, and maintenance with a Debt Service Coverage Ratio (DSCR) of at least 1.25x to withstand market downturns and vacancy fluctuations.
Frequently Asked Questions (BRRRR Real Estate)
What is the BRRRR real estate investment strategy?
BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat. It is a real estate wealth-building strategy where an investor purchases a distressed property under market value, renovates it to increase forced equity (After Repair Value), rents it out to generate cash flow, and executes a cash-out refinance to pull out their initial invested capital to repeat on the next property.
What is a 'Perfect BRRRR' (Infinite Return)?
A 'Perfect BRRRR' occurs when the new cash-out refinance loan (typically 75% of the After Repair Value) is equal to or greater than the total acquisition, rehab, and holding costs, resulting in $0.00 of the investor's own cash left in the deal. Because the investor has no remaining capital tied up while continuing to collect monthly cash flow, the Cash-on-Cash ROI is mathematically infinite.
What is the standard seasoning period for a BRRRR cash-out refinance?
Fannie Mae and conventional lenders typically require a 6-month seasoning period before allowing a cash-out refinance based on the new appraised After Repair Value (ARV). However, specialized DSCR (Debt Service Coverage Ratio) portfolio lenders can refinance in as little as 0 to 90 days with verified leases.