Refinance Calculator
Compare your current mortgage with refinancing options to find potential savings.
Monthly Savings
$322
Current Payment
$2,120
New Payment
$1,799
Break-Even Point
16 months
Lifetime Savings
$0
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What it does: Compares your current mortgage with a potential refinance to show monthly savings, break-even point, and total lifetime savings.
When to use: Use this when you are considering refinancing to a lower rate or different term and want to know if the savings justify the closing costs.
How to use: Enter your current loan balance, current rate, years remaining, new rate, new term, and estimated closing costs. The calculator shows your monthly savings and how long it takes to recover the closing costs.
Key Inputs Explained
Worked Example
Current: $300,000 at 7.0% with 25 years remaining, payment $2,122. New: $300,000 at 6.0% for 30 years, payment $1,799. Monthly savings = $323. Closing costs $5,000. Break-even = 15.5 months.
Assumptions & limitations: This calculator compares principal and interest only. Taxes and insurance do not change with refinancing (unless your escrow analysis shifts). It assumes you keep the new loan for the full break-even period.
Calculator FAQs
What is the break-even point?
The number of months it takes for your monthly savings to equal the closing costs. If you sell or refinance before the break-even, you lose money on the refinance.
Should I refinance to a shorter term?
A shorter term (like 15 years) saves more interest but raises your monthly payment. Only do it if you can comfortably afford the higher payment and value the interest savings.
Are refinance closing costs tax-deductible?
Points paid on a refinance are typically amortized over the life of the loan for tax purposes. Other costs are not deductible. Consult a tax professional.
What is a no-closing-cost refinance?
The lender covers closing costs in exchange for a higher interest rate. This can be beneficial if you plan to sell or refinance again within a few years.