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Browse our investment glossary and get clear on key 1031 exchange, tax, financial, and investment-related terms.

What is Cash-on-Cash? [Definition]

Cash-on-Cash 
An investment offering’s “cash-on-cash” (COC) is the cash income received by an investor in return for the cash invested. COC reflects an investment's net income after accounting for the cost of servicing the debt utilized. It differs from “cap rate,” which represents the annual net operating income received from an investment (prior to and excluding debt cost), divided by its purchase price or fair market value. Cap rate does not reflect the potential impact that financing can have on the cash flow. It is important to look at both metrics when evaluating an investment.

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