How does BRRRR financing work in Texas?

The short answer, as of October 2026

• Buy and rehab: 12.5% down at 9.75%, $29,815 to close, the rehab funded in draws.
• Rent: the rent has to cover the new payment, $2,250 against $2,206 here.
• Refinance after 180 days: a $216,000 DSCR loan at 8.38%, $29,141 back to you.
• Before 180 days: a payoff-only refinance replaces the flip loan with a 30-year loan, no cash back.

Capital Kings LLC is a broker, not a lender. We compare every file across 400+ lenders and send the term sheet with every fee on it before you sign.

Every dollar, line by line

A $150,000 purchase, a $45,000 rehab and a $270,000 after repair value in Texas, renting for $2,250, 720 credit, first deal. The real term sheets for the refinance:

Refinance after 180 daysPayoff only, before 181 days

Open the full term sheet →

Cash to close$0

Proof of funds to show$13,236

Every fee, and who gets paid

• Lender fees, underwriting and legalLender$2,295
• Broker feeBroker$2,160
• Closing / titleTitle co$2,160
• Property insuranceInsurer$1,350
• Escrow setup, 3 months of taxesLender$1,350
• Prepaid interestLender$744
• Appraisal feeAppraiser$550

$29,141 comes to you after the $176,250 payoff and every fee. The gold broker line is the only money Capital Kings earns.

A sample sheet for a made-up borrower, built the same way yours is. Yours takes about five minutes and doesn’t pull your credit.

Compare the options

Three steps on one deal: the loan you buy with, the refinance depending on when you do it, and the money that stays in the deal.

Step 1: buy and rehab

$150,000 purchase, $45,000 rehab, $270,000 after repair value, 720 credit, first deal. The rehab is funded in draws. Six months of interest is the term sheet’s estimate with the rehab fully drawn. 5% down is for properties in a Texas metro area (MSA). Rates as of October 2026.

Step 2: refinance into a DSCR loan

Refinancing the 12.5% down loan ($176,250 payoff) on a 30-year fixed DSCR loan, $2,250 a month of rent. Before 91 days only a payoff-only refinance is available. Until 180 days a cash-out is sized on what you paid plus the rehab, which here would fall short of the payoff, so payoff-only is the move. After 180 days the appraisal counts. Rates as of October 2026.

The money left in the deal

Cash you put in is the 12.5% down cash to close plus six months of interest. The refinance closing costs come out of the new loan. Rates as of October 2026.

Where the numbers come from

Step one is a fix and flip loan. It pays for most of the purchase and all of the rehab, released in draws as the work is inspected. On 12.5% down that is a $176,250 loan at 9.75% with 1% origination, and you bring $29,815 to close. 5% down takes less cash, $20,640, in a Texas metro area (MSA).

Step two is renting it. A DSCR loan qualifies on the rent, not your income, and the rent has to cover the full payment at a 1.00 DSCR or better. Here $2,250 covers a $2,206 payment at 1.02.

Step three is the refinance, and timing changes the loan. Before 90 days of ownership there is no cash-out. Between 90 and 180 days a cash-out is sized on what you paid plus the rehab, $156,000 here, which would leave you bringing $29,892 to pay off the flip loan, so a payoff-only refinance is the better move. After 180 days the appraisal counts: $216,000, 80% of the $270,000 value at 720+ credit, pays off the $176,250 flip loan and every closing cost and puts $29,141 in your pocket.

That leaves about $9,266 of your own money in a rental worth $270,000. Then you repeat it on the next house.

Four things to check

• Buy at the right price.BRRRR works when the after repair value is well above what you pay plus the rehab. That gap is the cash you get back.
• Line up the rent before you buy.The rent has to cover the new payment, or the refinance loan gets smaller.
• Plan the timing.The full appraisal counts after 180 days. A payoff-only refinance before that locks in a 30-year loan with no cash back.
• Keep the flip loan long enough.A 12-month flip loan gives you room to rehab, rent and season before the refinance.

Straight answers