Refinance Calculator

Money

See if refinancing saves you money: monthly savings, breakeven point, and lifetime interest saved.

Current loan balance

Current rate

Years remaining

yrs

New rate

New loan term

yrs

Closing costs

Monthly savings

Current payment-
New payment-
Breakeven-
Lifetime interest savings-
Verdict-

Compares principal and interest only; taxes, insurance, and PMI are not included. Simplified comparison, not financial advice.

How to use this calculator

1. Enter your current loan balance, rate, and years remaining. 2. Enter the new rate, new term, and closing costs from your refinance quote. 3. Read your monthly savings, breakeven point, and lifetime interest savings.

Worked example

A $400,000 balance at 7.5% with 30 years left, refinanced at 6.0% for 30 years with $8,000 closing costs: the payment drops from $2,797 to $2,398, saving about $399 a month. Breakeven is 21 months, and lifetime interest savings net of closing costs are about $135,516.

What this means and what to do next

If the verdict says it is worth it and you plan to keep the loan past the breakeven point, refinancing usually pays off. If the breakeven sits beyond your likely stay or you might move soon, the closing costs are not recovered.

Next steps

When you are ready to act: get loan estimates from at least three lenders, ask about no-closing-cost options, and re-run the numbers with your final quote.

How the math works

Current and new payments use the standard amortizing loan formula. Breakeven is closing costs divided by monthly savings, rounded up. Lifetime interest savings is the remaining interest on your current loan minus the interest on the new loan and the closing costs.

When is refinancing worth it?

Generally when the monthly savings repay your closing costs within about 3 years and you plan to keep the loan past the breakeven point. This calculator flags that threshold automatically.

What is the breakeven point?

Closing costs divided by monthly savings, rounded up. After that many payments, the savings have paid for the refinance.

Why not just compare rates?

A lower rate can still lose money if closing costs are high or the new term stretches payments out. Breakeven and lifetime interest tell the fuller story.

Does this include taxes and insurance?

No. Only principal and interest payments are compared. Taxes and insurance stay the same whether or not you refinance.

What if I plan to sell soon?

If you sell before the breakeven point, you never recover the closing costs, so refinancing usually does not pay off.

How it works

How the Refinance Calculator works

Quick answer: Refinancing a $400,000 balance from 7.5% to 6.0% (30 years, $8,000 closing costs) saves about $399 a month and breaks even in 21 months.

Formula

Monthly savings = current payment − new payment
Breakeven months = closing costs ÷ monthly savings

Lifetime savings compare total interest on both loans and subtract closing costs.

Worked example

Current payment: $2,797. New payment: $2,398. Savings: $399 a month. Breakeven: 21 months. Lifetime interest savings: $135,516.

$400,000 from 7.5%, $8,000 closing costs

New rate	Monthly savings	Breakeven	Open
5.5%	$526	16 months	Open
6.0%	$399	21 months	Open
6.5%	$269	30 months	Open
7.0%	$136	59 months	Open

Assumptions and limits

Restarting a 30-year term can lower the payment but extend total interest; compare lifetime savings too.

Frequently asked questions