See the return on the cash you put into a rental, after the mortgage payment, and compare it with cap rate.
Enter your numbers to see the results.
| Gross potential income (GPI) | |
|---|---|
| Vacancy loss | |
| Effective gross income (EGI) | |
| Operating expenses |
Estimate only, not investment, tax or legal advice. Cash-on-cash is the first year’s pre-tax cash flow divided by the cash you put in. It ignores appreciation, selling costs, income taxes and future rent changes. Mortgage principal and interest are debt service, not an operating expense. For a full expense breakdown (taxes, insurance, management and the rest), use the Cap Rate calculator and paste that NOI in here.
Last reviewed: November 5, 2026
Cap rate looks at a property as if you paid cash: net operating income divided by price. Cash-on-cash asks a different question — what did you earn on the money you actually wrote checks for, after the loan payment? Enter the price, the cash you put in (down payment, closing costs and any rehab you pay in cash) and either an NOI you already have or a simple version built from monthly rent, vacancy and one operating-expense total. Add the mortgage and you’ll see monthly principal and interest, annual debt service, annual cash flow and the cash-on-cash return. The page also shows cap rate on price as a comparison figure.
Price $300,000, down payment $75,000, closing costs $6,000, rehab $4,000, NOI $22,000, and a $225,000 loan at 6.5% for 30 years. Cash invested is $85,000.00. The monthly payment is $1,422.15, so annual debt service is $17,065.80. Annual cash flow is $4,934.20. Cash-on-cash return is 5.80%. Cap rate on the $300,000 price is 7.33%.
Price $200,000 paid in cash plus $5,000 of closing costs, NOI $16,000 and no mortgage. Cash invested is $205,000.00. Cash flow equals the NOI: $16,000.00. Cash-on-cash is 7.80%. Cap rate is 8.00% — higher than cash-on-cash here only because the extra $5,000 of closing costs sits in cash invested but not in the price.
Price $275,000, down $55,000, closing $8,250, rent $2,450 a month, 5% vacancy, $7,200 of annual operating expenses, and a $220,000 loan at 7% for 30 years. GPI is $29,400.00, vacancy loss is $1,470.00 and EGI is $27,930.00. NOI is $20,730.00. The monthly payment is $1,463.67 (annual debt service $17,564.04). Annual cash flow is $3,165.96. Cash invested is $63,250.00. Cash-on-cash is 5.01%. Cap rate is 7.54%.
Price $400,000, down $80,000, closing $10,000, NOI $18,000, and a $320,000 loan at 7.25% for 30 years. Cash invested is $90,000.00. The monthly payment is $2,182.96, so annual debt service is $26,195.52 — more than the NOI. Cash flow is −$8,195.52. Cash-on-cash is −9.11%. Cap rate is still 4.50%, because cap rate ignores the loan. The tool warns that expenses and debt service exceed NOI.
$150,000 paid in cash, rent $1,800 a month, 8% vacancy and $5,500 of operating expenses. GPI is $21,600.00, vacancy loss is $1,728.00 and EGI is $19,872.00. NOI is $14,372.00. With no mortgage, cash flow is also $14,372.00. Cash-on-cash is 9.58%, and cap rate is also 9.58%, because cash invested equals the price.
Price $400,000, $100,000 of cash in, NOI $11,555 and no mortgage. Cash flow is $11,555.00. Cash-on-cash is 11.56%. Cap rate is 2.89%. This is the intermediate print in verify_wave3 (loan = 0). The spec’s case 6 is the next row.
Same $100,000 of cash and $11,555 of NOI, plus a 0% loan of $12,000 over 12 months. The monthly payment is $1,000.00, so annual debt service is $12,000.00. Cash flow is −$445.00, which is −0.445% of $100,000, shown as −0.45%. Cap rate stays 2.89%.
| Deal | Cash invested | Cash flow | Cash-on-cash | Cap rate |
|---|---|---|---|---|
| CC1 (financed, $22,000 NOI) | $85,000.00 | $4,934.20 | 5.80% | 7.33% |
| CC2 (all cash + closing) | $205,000.00 | $16,000.00 | 7.80% | 8.00% |
| CC3 (NOI from rent) | $63,250.00 | $3,165.96 | 5.01% | 7.54% |
| CC4 (negative cash flow) | $90,000.00 | −$8,195.52 | −9.11% | 4.50% |
| CC5 (all cash, no extra cash) | $150,000.00 | $14,372.00 | 9.58% | 9.58% |
| CC6b (0% $12,000 loan over 12 months) | $100,000.00 | −$445.00 | −0.45% | 2.89% |
It is annual pre-tax cash flow divided by the cash you invested. Cash flow here is NOI minus the year’s mortgage payments. On CC1, $4,934.20 ÷ $85,000.00 is 5.80%.
Cap rate is NOI divided by price and ignores the loan. Cash-on-cash includes the loan and measures the cash you put in, which also includes closing costs and rehab. On CC1 the cap rate is 7.33% while cash-on-cash is 5.80%. On an all-cash deal with no extra closing or rehab costs, the two percentages match (CC5: both 9.58%).
Down payment, closing costs and rehab or initial improvements you pay in cash. The financed portion of the price is not cash invested.
No. Principal and interest are debt service, subtracted after NOI. Putting them in operating expenses would understate NOI and mix up the cap-rate comparison.
The property can earn NOI and still not cover the loan payment. CC4 has a 4.50% cap rate and a −9.11% cash-on-cash return, because $26,195.52 of debt service is larger than the $18,000 NOI.
In Full mode: yearly rent, minus vacancy, minus one operating-expense total. For line-by-line taxes, insurance, management, maintenance and reserves, use the Cap Rate calculator and then enter that NOI in Quick mode here.
The magnitude rounds half-up and the minus sign is kept. −0.445% displays as −0.45%, which is the CC6b check. Ordinary half-up on the signed value would have gone the wrong way in some programming languages.
Not by itself. A high figure can come from a small cash investment, deferred maintenance, an aggressive rent or a loan that will reset later. Compare it with cap rate, local sales and the condition of the building, and treat both numbers as a first-year snapshot.