Refinance Calculator
Compare your current mortgage to a refinance scenario. See your new payment, monthly savings, total interest difference, and how long until closing costs pay for themselves.
How it works
- 1Enter your current loan
Use the remaining balance, current rate, and years still left.
- 2Enter the refinance offer
Add the new rate, new term, and estimated closing costs.
- 3Check your break-even point
If you'll stay in the home longer than the break-even, refinancing wins.
Mortgage refinancing replaces your existing loan with a new one — typically at a lower rate, a different term, or both. The decision comes down to three numbers: how much you save per month, how much it costs to refinance, and how long you'll stay in the home.
The break-even point is the most important refinance metric. If a refinance costs $6,000 in closing costs and saves $200/month, your break-even is 30 months. You need to stay in the home for at least 30 months to come out ahead.
Beware of refinancing into a fresh 30-year term if you're already several years into your current mortgage. Even at a lower rate, restarting the clock often costs more in total interest. Consider refinancing into a shorter term that matches your remaining payoff timeline.
Common rules of thumb: aim for at least 0.5–0.75% rate reduction, recoup closing costs within 24–36 months, and avoid refinancing if you might sell within 2 years.
Example scenarios
If you save $250/mo, break-even is 24 months.
Save ~$200/mo, break-even ~40 months.
Adds debt; only worth it for high-return use of cash like debt consolidation or value-adding renovations.
Common questions
When does refinancing make sense?
Refinancing usually pays off when the new rate is at least 0.5–0.75% lower than your current rate AND you plan to stay in the home long enough to recoup the closing costs (the break-even point).
What is the break-even point?
It's the number of months it takes for your monthly savings to equal the closing costs of the refinance. If your break-even is 36 months and you'll sell in 2 years, refinancing loses money.
What are typical refinance closing costs?
Refinance closing costs are usually 2%–5% of the loan amount, covering appraisal, title, origination, and recording fees. A $300,000 refinance might cost $6,000–$15,000.
Does refinancing restart my loan term?
Yes — a new 30-year refinance restarts the clock at 30 years. If you've already paid 8 years on your current mortgage, consider a 20- or 22-year term instead to avoid lengthening total interest paid.