Refinance Calculator
Monthly savings, break-even point, and lifetime interest saved on a mortgage refinance
Know before you refinance
A lower rate sounds great — but does it actually save you money after closing costs and a potentially longer term? This calculator answers that.
Break-even analysis
See exactly how many months until your savings exceed the closing costs you paid upfront.
Lifetime savings
Compare total interest over the remaining life of both loans — not just the monthly payment.
Side-by-side view
Current vs new: payment, rate, term, and total cost laid out clearly together.
Closing cost impact
Include your actual or estimated closing costs to get a real-world, accurate break-even.
PDF analysis
Download a clean refinance analysis to compare lender offers or take to a mortgage advisor.
100% private
All calculations run in your browser. No financial data is stored or shared.
When to use it
Rates dropped
Rates fell since you bought. Find out if the timing now makes financial sense.
Equity grew
Home value rose — check if you can drop PMI or access better rate tiers.
Comparing lenders
Got multiple refi quotes? Enter each one to find the best true deal.
Lower payments
Need to reduce monthly obligations? Model the savings vs total cost trade-off.
Frequently Asked Questions
When does refinancing make financial sense?
Refinancing generally makes sense when you can reduce your rate by at least 0.5–1%, you plan to stay in the home long enough to recoup the closing costs, and the new loan does not extend your payoff date by too many years (unless you specifically need lower payments). The break-even calculation — closing costs divided by monthly savings — tells you the minimum months you need to stay to benefit.
What is the break-even point?
The break-even point is the number of months it takes for your cumulative monthly savings to equal the closing costs you paid upfront. For example, if you pay $4,000 in closing costs and save $200/month, you break even at 20 months. If you plan to stay in the home at least that long, refinancing saves money. If you move or refinance again before that, you lose money on the deal.
What costs are involved in refinancing?
Closing costs typically run 2–5% of the loan balance and include origination fees, appraisal, title insurance, attorney fees, and prepaid interest. Some lenders offer "no-closing-cost" refis where costs are rolled into a slightly higher rate — use this calculator to compare whether absorbing costs upfront or through a higher rate works out better.
Does refinancing reset my loan term?
It does if you take a new 30-year term — and this is the most common refinance trap. Lower payment, same or similar rate, but you are now paying for 30 more years rather than the 20 or 25 you had left. This often costs more in total interest than your original loan. The better option is to refinance into a shorter term (e.g., a 15-year) or keep making the higher old payment on the new, lower-rate loan.
Can I refinance to get rid of PMI?
Yes, if your home value has risen enough that you now have 20% equity. Refinancing appraises your home at current market value; if that value supports an 80% LTV, the new loan will not require PMI. This can save $100–250/month on its own, sometimes making refinancing worthwhile even without a rate improvement.
Understanding Mortgage Refinancing
Refinancing replaces your existing mortgage with a new one, typically at a different rate, term, or both. The promise is appealing — lower monthly payments, less total interest, or both. But the reality is more nuanced: refinancing always comes with costs, and whether those costs are justified depends on your rate reduction, how long you keep the new loan, and what you do with your term.
The break-even calculation
The single most important number in any refinance decision is the break-even point: closing costs ÷ monthly savings. If your closing costs are $5,000 and your new payment is $200/month lower, you break even in 25 months. Stay longer: you save money. Move or refinance again sooner: you lose money. Run this calculation before anything else. The lower the break-even point, the less risky the refinance.
The term trap
The most common refinance mistake is taking a new 30-year term when you already have 22 years left on your mortgage. Yes, the payment is lower — but you are also committing to 8 additional years of payments. Even with a lower rate, this often costs more total interest than simply staying with your current loan. If you refinance, consider matching or shortening your term. If you cannot afford the higher payment, at minimum keep making your old payment amount on the new loan — you will still pay it off years earlier than the new schedule requires.
Rate vs total cost
A lower rate does not automatically mean a better deal. Two scenarios where a lower rate still costs you more: rolling closing costs into the loan (you pay interest on them for years), and extending the term (more payments, even at a lower rate). Always compare total interest paid over the actual remaining life of the loan — not just the new monthly payment — before deciding whether to refinance.