Glossary
Peak cash
Peak cash is the most of your own money tied up in a deal at any one time. On a flip it usually hits right before the sale; on a BRRRR, right before the refi.
Investors plan for the down payment and get surprised by everything after it. Points, interest, holding costs and fronted rehab work pile up month after month until the sale or refi pays you back. Peak cash is how much you need in the bank to finish.
How to calculate it
Add up the cash you put in month by month: closing day costs, then each month's interest, holding costs and any rehab you pay before the lender reimburses. The highest running total is peak cash.
- Down payment
- $19,000
- Buy closing costs
- $4,000
- Points and lender fees
- $5,920
- Cash at closing
- $28,920
- Interest and holding, 6 months (about $2,350 a month)
- $14,100
If you front a $12,500 draw in month 5 and get it back in month 6, cash briefly peaks higher, at about $53,170.
Why it matters
- It is the real check you need to write, not just the down payment.
- It limits how many deals you can run at once.
- It is the denominator of ROI on cash, so leaving costs out inflates returns.
What to watch
- Delays push peak cash up. Each extra month adds interest and carry.
- Reimbursement-style draws mean you float a stage of work.
- Keep a reserve on top of peak cash for overruns.
Run The Deal tracks cash month by month and reports peak cash on every flip and BRRRR in the flip calculator.
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