Cash Flow Mortgage Calculator
Despite the word mortgage in this page’s address, this is a rental cash flow tool, not a mortgage payment tool. The mortgage payment is one expense line inside a full rental profit and loss snapshot: rent and other income, vacancy, taxes, insurance, maintenance, capital improvements and management, then the loan payment, leaving monthly and annual cash flow plus the investor metrics lenders actually read. This page owns that snapshot. The purchase decision, with closing costs, repairs, appreciation and a multi-year projection, belongs to the buying rental property analysis, and the lender-bar framing belongs to the rental mortgage analysis.
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NOI excludes debt service by definition; cash flow subtracts it. Break-even rent is the rent at which monthly cash flow is exactly zero. Cash-on-cash divides by the down payment only, with no closing costs in the denominator. The verdict badge follows the DSCR bands below, and it reads the unrounded DSCR, not the rounded display.
Quick Answer
A $350,000 rental with $87,500 down, a 6.5% 30-year loan, $3,000 rent, $100 other income and 5% vacancy produces $325.22 per month in cash flow ($3,902.66 per year). That is a 4.46% cash-on-cash return, a 6.80% cap rate, and a DSCR that displays as 1.20 but is 1.196 before rounding, just under the 1.20 lender bar, so the badge reads Thin margin rather than Solid. Rent below $2,627.89 turns the deal cash-flow negative. The calculator above is pre-filled with this example.
Key takeaways
- Never judge a rental by its mortgage payment alone: vacancy, management and capex reserves decide the real return, and in this example they take $960.60 a month before the mortgage is even considered.
- NOI measures the property and excludes debt service. Cash flow measures your pocket and subtracts it. Mixing the two up is the most common rental math error.
- Know your break-even rent before you negotiate price, not after. This deal has only about 12% of rent as margin before cash flow turns negative.
- Cash-on-cash here divides by the down payment only. A rival page that adds closing costs to the denominator will show a lower figure for the same deal, and the two are not directly comparable.
How to use the rental cash flow calculator
Enter the deal once, in the units the labels state, then read the snapshot. Results stay hidden until you click Calculate Cash Flow, and Reset restores the worked example.
- Enter price, down payment, rate and term: the loan is price minus down payment, floored at zero, and the monthly payment uses the standard amortisation formula. A 0% rate divides the loan evenly over the term.
- Enter rent and other income monthly: rent is contract rent, other income covers parking, laundry and fees.
- Enter vacancy as a percent: 5% is the worked example. The tool caps vacancy at 100% and applies it to gross income before any expense.
- Enter tax, insurance, maintenance and capex as annual figures: this is the step most often done wrong. A monthly tax or insurance bill entered here understates that cost twelvefold.
- Enter management as a percent of effective income: not of gross rent. Effective income is gross income after vacancy, so management shrinks when vacancy rises.
- Click Calculate Cash Flow: monthly cash flow leads, with mortgage, monthly NOI, annual cash flow, cash-on-cash, cap rate, DSCR, operating expense ratio, gross rent multiplier, break-even rent and loan amount underneath.
This tool does not show error messages. Blank entries count as zero, negative entries are clamped to zero, a term below 1 year counts as 1 year, and vacancy above 100% counts as 100%. A blank rent therefore produces a deeply negative cash flow rather than a warning, so check for empty fields before trusting a bad result. The same silent clamping means a negative tax entry does not warn you: it simply vanishes.
How the monthly dollar gets sliced
Cash flow is income minus everything, in a fixed order. Start with gross rent, haircut it for vacancy, subtract operating expenses, and you get net operating income (NOI). NOI minus debt service is cash flow. The worked example, monthly:
| Line | Monthly amount | How it is built |
|---|---|---|
| Rent + other income | $3,100.00 | $3,000 + $100 |
| Vacancy (5%) | −$155.00 | 5% of $3,100 |
| Operating expenses | −$960.60 | $725.00 fixed costs + $235.60 management |
| Monthly NOI | $1,984.40 | $2,945.00 effective income − $960.60 |
| Mortgage (P&I) | −$1,659.18 | $262,500 loan, 6.5%, 30 years |
| Cash flow | $325.22 | $1,984.40 − $1,659.18 |
Fixed operating costs are $8,700 a year ($3,600 tax + $1,500 insurance + $2,400 maintenance + $1,200 capex), which is $725.00 a month. Management is 8% of effective annual income ($35,340), which is $2,827.20 a year or $235.60 a month. Investors who skip vacancy, management and capex reserves routinely overstate returns by a third or more, because those three lines alone are $390.60 a month in this example.
The five investor metrics that matter
Five numbers, each answering a different question. The ranges below are common investor and lender practice, not guarantees and not approval rules.
| Metric | Formula | Worked example | Common reading |
|---|---|---|---|
| Cash-on-cash return | Annual cash flow ÷ down payment | 4.46% | 8% and up is strong; under 5% is thin |
| Cap rate | Annual NOI ÷ purchase price | 6.80% | 5% to 8% is typical for residential |
| DSCR | Annual NOI ÷ annual debt service | 1.20 (1.196 unrounded) | Lenders commonly look for 1.20 to 1.25 |
| Operating expense ratio | Operating expenses ÷ effective income | 32.62% | 35% to 45% is normal; lower is better managed |
| Gross rent multiplier | Purchase price ÷ annual gross rent | 9.41 | Lower means cheaper relative to rent |
DSCR deserves special attention because it is the number that approves or kills an investment loan in practice. A DSCR of 1.20 means income covers debt payments with 20% to spare, the cushion most commercial lenders look for. The badge in this tool reads the unrounded figure: 1.20 and above is Solid coverage, 1.00 to under 1.20 is Thin margin, and under 1.00 reads Cash-flow negative. That last label follows the DSCR band, not a separate cash-flow test, except for an all-cash purchase with no debt service, which shows DSCR N/A and, when cash flow is positive, the All-cash purchase badge instead. Read the badge together with the cash flow line, never alone. Cap rate tells you what the property earns independent of financing, which is how you compare deals across markets, while cash-on-cash tells you what your actual dollars earn, and this tool's denominator is the down payment alone.
Break-even rent: your red line
Break-even rent is the monthly rent at which cash flow is exactly zero: every dollar below it is a dollar out of your pocket. The formula solves for rent, holding vacancy and management percentages fixed, and subtracting other income at the end: break-even rent = (monthly mortgage + fixed annual costs ÷ 12) ÷ ((1 − vacancy) × (1 − management)) − other income. In the worked example that is ($1,659.18 + $725.00) ÷ (0.95 × 0.92) − $100 = $2,627.89, only about 12% below the $3,000 asking rent. That thin margin is exactly why the badge flags the deal as Thin.
Small assumption changes move the red line a lot, so stress-test them in the calculator rather than trusting one run. Self-managing, with management set to zero, drops break-even to $2,409.66, a fall of $218.23, and lifts monthly cash flow to $560.82. Vacancy at 10% instead of 5% pushes break-even to $2,779.44 and cuts monthly cash flow to $182.62. Rent at $2,000, with everything else unchanged, gives negative $548.78 a month and a DSCR of 0.67, while break-even itself stays $2,627.89 because break-even does not depend on the rent you entered, only on costs, vacancy, management and other income.
What competing rental calculators leave out
Most rental cash-flow tools stop at monthly cash flow and call it done: no DSCR, no break-even rent, no capex reserve line, and vacancy treated as optional. Without capex reserves, a single roof replacement wipes out years of paper profit. Without DSCR, you have no idea whether a lender will even fund the deal. Without a separate management line, self-managed deals look better than they are and break the moment a manager is hired.
This calculator includes all five investor metrics plus the break-even red line, with capex and management as their own lines, so the number you get is closer to the number a lender would underwrite. It still leaves out what belongs elsewhere: it has no closing costs, no repairs budget, no appreciation and no multi-year projection, which is the purchase analysis the buying rental property calculator covers. For the financing side alone, the mortgage payment calculator sizes the loan payment on its own, and the cap rate calculator digs deeper into valuation. If you want rent minus itemised expenses without the investor metrics, the net rental income calculator gives that narrower view.
Frequently asked questions
8% or higher is generally considered strong for residential rentals, and under 5% is thin once you account for risk and illiquidity. Compare against what the same down payment would earn elsewhere, and remember this tool divides by the down payment only, with no closing costs in the denominator, so its figure runs higher than a version that includes them.
NOI is income minus operating expenses, excluding debt service: it measures the property. Cash flow subtracts the mortgage payment: it measures your pocket. Lenders underwrite on NOI via DSCR, which is why this tool shows both instead of collapsing them into one number.
It means income covers debt payments with 20% to spare, the cushion most commercial lenders look for to absorb vacancy or rate shocks. Below 1.20, financing gets difficult or expensive, and below 1.00 the property does not cover its own debt service. The 1.20 figure is common lender practice, not a universal approval rule, and different lenders set different bars.
Yes, for honest analysis. Your time has value, and if you ever hire management, the deal must still work. Underwrite with the fee and treat self-management as a bonus: in the worked example, dropping management to zero lifts monthly cash flow from $325.22 to $560.82, which shows how much of the return self-management is really supplying.
5% to 10% is standard for stable residential markets. Use local data where you can: student or seasonal markets run higher. The calculator's break-even rent shows how sensitive you are to this input, and vacancy at 10% instead of 5% cuts the worked example's monthly cash flow from $325.22 to $182.62.
Some investors accept it betting on appreciation, but it is speculation, not investing: you are paying monthly for the privilege. Know the exact monthly cost and have reserves before you sign, and check the break-even rent first so the size of the monthly subsidy is a deliberate choice, not a surprise.
Because the denominators differ. This page divides annual cash flow by the down payment only, with no closing costs included. The rental mortgage page adds a 3% of price closing assumption to its denominator, so the same deal shows a lower cash-on-cash return there. Neither figure is wrong: they answer slightly different questions, and comparing them as if they were identical is the error to avoid.
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References
- National Association of Realtors. Research and Statistics (investment property and cap-rate context). Accessed October 24, 2026.
- U.S. Small Business Administration. 7(a) Loans (DSCR-style underwriting context for income-property lending). Accessed October 24, 2026.
- U.S. Department of Housing and Urban Development. Buying a Home (landlord cost guidance). Accessed October 24, 2026.
- Internal Revenue Service. Publication 936: Home Mortgage Interest Deduction (rental interest deductibility context). Accessed October 24, 2026.
- Consumer Financial Protection Bureau. What is private mortgage insurance (PMI)? (low-down-payment investor loans). Accessed October 24, 2026.
- Freddie Mac. Primary Mortgage Market Survey (mortgage rate context for the rate input). Accessed October 24, 2026.
- National Association of Realtors. Existing-Home Sales (market context). Accessed October 24, 2026.
- Board of Governors of the Federal Reserve System. Why does the Federal Reserve aim for inflation of 2 percent? (inflation context for real-return comparisons). Accessed October 24, 2026.
- U.S. Department of the Treasury, Fiscal Data. Average Interest Rates on U.S. Treasury Securities (risk-free rate context for return comparisons). Accessed October 24, 2026.
- Internal Revenue Service. Topic No. 503, Deductible Taxes (property-tax deduction context). Accessed October 24, 2026.