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What is cash flow damming?
September 21, 2026 | Posted by: Craig Nickerson
Own a rental property? Cash-flow damming may help you use rental income more strategically while paying down personal mortgage debt faster.
Here’s the basic idea: instead of using rent to pay rental expenses, the rental income is directed toward your non-deductible personal mortgage. A separate borrowing account is then used to pay eligible rental expenses. Over time, personal debt may decrease while properly traced income-producing debt increases.
Because interest deductibility depends on how borrowed funds are used—not which property secures the loan—the interest on money borrowed for eligible rental expenses may be tax-deductible. Careful recordkeeping and separate accounts are essential.
This strategy is not suitable for everyone. It should be structured with guidance from a mortgage professional and qualified tax advisor.
Want to learn whether your mortgage can support this strategy?
Call or text Craig at 613-394-5810
craig@simpligomortgages.com
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