Refi Proceeds Gap Calculator

Refi proceeds may fall short or generate cash-out depending on LTV and fees. This calculator sizes the gap.

New loan proceeds

Existing payoff

Closing costs

Reserves + escrows

Proceeds gap (+ = cash-out)

$405,000

Total uses

$6,095,000

Gap % of new loan

6.23%

How the math works

Gap = new loan − (payoff + closing + reserves). Positive = cash-out; negative = cash-in.

Always model gap with stressed rate (+50 bps) and tightened LTV (−5 points). A refi that pencils only at quoted terms is a deal you can lose in a rate reprice.

How to Use

Enter new loan proceeds.
Enter existing payoff.
Enter closing costs.
Enter reserves/escrows.
Read the proceeds gap.

Frequently Asked Questions

Positive or negative?

Positive = cash-out refi delivers net cash to sponsor. Negative = cash-in refi requires sponsor to bring equity to close. Zero-gap refi is rare but ideal for rate-only refinances.

Typical closing costs?

Origination 50-100 bps, legal $15-40k, title $5-15k per $1M, appraisal $5-15k, survey $3-8k, reserves 3-6 months of debt service. Total 2-4% of new loan.

Cash-in avoidable?

Sometimes with rate buydown, seller financing, or preferred equity layer. But a small cash-in can preserve the sponsor's position in a tight market while waiting for better terms.

When does a lender negotiate vs foreclose?

Lenders calculate their net recovery from foreclosure (asset value minus legal, time, and sale costs) and compare to any workout proposal. If your offer nets the lender more than foreclosure, and you present it with clear sources of capital, most lenders will engage. Bring a credible sponsor, documented sources, and a timeline — vague asks get declined. Build the relationship before distress, not after.