Mortgage Refinance Calculator
Refinancing trades closing costs today for a lower payment tomorrow. This shows how many months it takes to recoup those costs and whether you come out ahead over the life of the loan.
$142.34 monthly savings
- New payment
- $2,074.63 was $2,216.97
- Break-even
- 3 yr 7 mo
- Lifetime savings
- $36,703 net of closing costs
How it works
The remaining balance is re-amortised at the new rate and term. Break-even is closing costs divided by the monthly payment reduction; lifetime savings nets the interest still owed on each path against the closing costs.
Frequently asked questions
Is it worth refinancing my mortgage?
It usually makes sense if the new rate is at least about 0.5–0.75 percentage points lower and you'll stay in the home past the break-even point — the month when accumulated payment savings cover the closing costs. The calculator shows that month for your numbers.
How is the refinance break-even calculated?
Break-even months = total closing costs ÷ the monthly payment reduction. If closing costs are $6,000 and refinancing drops the payment $250 a month, you break even in 24 months.
Does refinancing reset my loan term?
It can. Refinancing a loan with 24 years left into a new 30-year loan lowers the payment but stretches repayment out again, which can increase total interest even at a lower rate. Refinancing into a 15- or 20-year term avoids that. Compare the lifetime-interest figures the calculator reports.
What are typical mortgage refinance closing costs?
Refinance closing costs generally run 2–5% of the loan amount — lender origination, appraisal, title, and recording fees. Some lenders offer 'no-closing-cost' refinances that fold the fees into a slightly higher rate.
Learn more: When refinancing your mortgage makes sense — The break-even test, why a lower rate is not automatically a win, and when a cash-out refinance or a recast is the better tool.