Refinance Calculator
Calculate mortgage refinance savings, break-even point, and monthly payment reduction. Compare current vs new loan terms to determine if refinancing is worth the closing costs.
Current Loan
Enter term in months (e.g., 360 for 30 years)
New Loan
Enter term in months (e.g., 360 for 30 years)
Typically 2-5% of loan amount
New Monthly Payment
$1,448
/month
Monthly Savings
+$132
/month
Total Savings
-$52,230
over the life of the loan
Break-Even Point
3 years, 2 months
to recover closing costs
Loan Comparison
| Current | New | |
|---|---|---|
| Interest Rate | 6.5% | 5.5% |
| Monthly Payment | $1,580 | $1,448 |
| Loan Term | 25 years | 30 years |
| Total Cost | $474,000 | $526,230 |
Refinancing May Not Be Beneficial
While your monthly payment is lower, extending the loan term means you'll pay more in total interest over the life of the loan.
Why Use a Refinance Calculator?
Refinancing can lower your monthly payments and save thousands over the life of your loan. However, closing costs and extended terms can offset these benefits. Our calculator helps you make an informed decision by showing your break-even point and total savings.
Frequently Asked Questions
When should I consider refinancing?
Consider refinancing when interest rates drop 1% or more below your current rate, your credit score has improved significantly, or you want to change your loan term. Always factor in closing costs and how long you plan to stay in the property.
What is a break-even point?
The break-even point is when your monthly savings equal the closing costs paid. After this point, you start saving money. If you plan to sell or pay off the loan before break-even, refinancing may not be worthwhile.
Does refinancing affect my credit score?
Refinancing involves a hard credit inquiry which may temporarily lower your score by a few points. However, making consistent payments on the new loan and having a lower debt-to-income ratio can improve your score over time.
What are typical closing costs?
Closing costs typically range from 2-5% of the loan amount. They include origination fees, appraisal, title insurance, and other charges. Some lenders offer no-closing-cost refinancing with slightly higher rates.
Should I extend my loan term when refinancing?
Extending your term lowers monthly payments but increases total interest paid. Shortening your term means higher payments but less interest overall. Consider your financial goals and budget when choosing.