Refinancing is a powerful way to unlock equity, optimize debt, and return capital to investors—if it’s modeled correctly. IntellCRE makes it easy to layer a refinance on top of your acquisition loan and see exactly how it impacts cash flow, loan balances, and returns over time.
This guide walks through how refinancing works in IntellCRE and how to use it effectively in your deal analysis.
Step 1: Understand Where Property Value Comes From
Before modeling a refinance, it’s important to know how IntellCRE determines property value, because that value drives the refinance loan amount.
In IntellCRE, property value can be derived from:
Comparable sales–based price estimates, or
Cap rate–based valuation (most commonly used for refinancing)
Step 2: Set Up Acquisition Financing First
Refinancing always builds on top of your original loan.
Under Acquisition Financing, you can:
Set LTV, loan amount, and down payment
Let IntellCRE automatically size the loan to meet a target DCR (e.g., 1.25), or
Manually customize loan sizing and terms
Once acquisition financing is in place, you’re ready to layer in a refinance.
Step 3: Enable and Configure the Refinance
To model a refinance:
Click Refinancing within the financing section to open the refinancing interface
Here, you’ll define the core refinance terms:
Interest Rate
Amortization (Years)
Refinance Month
This determines when the refinance occurs (in months)
12 = Year 1
24 = Year 2
60 = Year 5
120 = Year 10
Loan Fee
Interest Rate Spread
Interest-Only Period (Years)
The refinance is triggered automatically at this point in the hold period.
Step 4: Set Valuation Assumptions for the Refinance
On the right side of the Refinancing panel, you’ll find one of the most critical inputs:
Cap Rate Used for Valuation
This cap rate is applied to the NOI in the refinance year to determine property value at refi.
Example:
NOI in Year 5: $237,000
Cap Rate: 4.0%
Implied Property Value: ~$6.2M
As NOI grows over time, refinancing later—or at a tighter cap rate—can significantly increase value.
Step 5: Review Cash-Out, Loan Payoffs, and Cash Flow Impact
Once the refinance value is set, Refinance LTV controls the outcome of the transaction. It determines the total refinance loan amount, how much is used to pay off the original acquisition debt, and whether there are cash-out proceeds.
IntellCRE automatically applies refinance proceeds to:
Pay off the remaining balance of the acquisition loan
Allocate any excess proceeds as cash-out
This makes it easy to model:
Return of capital
Investor distributions
Reinvestment into other deals
Funding property improvements or reserves
To see the full impact, open the Cash Flow Preview panel. You’ll be able to review:
Remaining acquisition loan balance at the refinance date
Loan payoff using refinance proceeds
New loan balance and ongoing debt service
Updated cash flow before and after the refinance
After refinancing, the deal continues under the new loan terms, with interest and principal payments following the refinance structure. At exit, sale proceeds are automatically used to pay off the refinance loan.
Why This Matters
Modeling refinancing correctly helps you:
Accurately project cash-out scenarios
Show investors how and when capital is returned
Compare hold strategies and refinance timing
Stress-test valuation and cap rate assumptions
The key drivers to always keep in mind:
NOI in the refinance year
Cap rate used for valuation
Refinance LTV
Together, these determine value, loan size, and cash-out potential.
Final Thoughts
Refinancing in IntellCRE is designed to mirror how real-world deals work—combining acquisition debt, refinance timing, valuation assumptions, and loan payoffs into one seamless model.
Dial in your NOI growth, choose realistic cap rates, and use refinance LTV strategically to tell a clear, compelling capital story for your deal.
Spend a few minutes setting it up—and gain clarity that can shape smarter investment decisions.