BRRRR Glossary

• BRRRR Method (Real Estate Investing)

  Buy, rehab, rent, refinance, repeat

• Cash-Out Refinancing

  New, larger loan that pays off the old one and returns the difference

• Loan-to-Value Ratio (LTV)

  Loan as a share of appraised value; sets the cash out

• Hard Money Loan

  Short-term, asset-based loan for the buy and rehab

• Real Estate Appraisal

  How the after-repair value gets measured

• Refinancing

  Replacing one loan with another; the fourth R

• Bridge Loan

  Short-term financing until permanent financing is in place

• Flipping

  Buy, renovate, sell; BRRRR keeps the property instead

• Cash on Cash Return

  Cash flow over cash left in; the headline result

• Property Investment Calculator

  Flip calculator and rental calculator chained together

• Sales Comparison Approach

  How ARV is derived from renovated comparable sales

• BiggerPockets

  The community that popularized the BRRRR acronym

• Fannie Mae

  Sets conventional cash-out refinance rules, including seasoning

• Debt Service Coverage Ratio (DSCR)

  Rent over payment; the refinance path when seasoning bites

• Mortgage

  The permanent loan the property ends up carrying

• Leverage (Finance)

  Borrowed money; BRRRR recycles it

• Rental Value

  Market rent; drives whether the refinanced property cash flows

• Home Equity Loan

  Second loan or line of credit against equity; the refinance alternative

• Closing Costs

  Fees paid at purchase and again at the refinance

• Down Payment

  The initial cash in; what the strategy aims to recover

• Capital Appreciation

  Value gain; BRRRR forces it through the rehab

• Net Operating Income (NOI)

  Rent after expenses, before the new loan; the hold-phase basis

• Amortization Calculator

  Computes the new loan's payment and principal-interest split