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Enter your current loan balance, rate and remaining years, then the new rate, term and closing costs.
When does a refinance pay for itself?
Everything happens on your device: nothing is uploaded to the internet.
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Refinance break-even calculator: what it is for
Enter the balance, interest rate and years left on your current mortgage, and the rate, term and closing costs of the new loan. The calculator shows the current and new principal and interest payments, the monthly savings, the break-even point in months and years, and the total interest left on each loan.
It warns you when a longer term makes the refinance cost more in total interest even though the monthly payment goes down, and you can roll the closing costs into the new loan to see the effect.
How to use
- Enter your current loan.
- Enter the new rate, term and closing costs.
- Read the savings and the break-even point.
When to use it
- Deciding whether to refinance.
- Comparing lender offers.
- Checking a cash-in or rate-and-term refi.
Frequently asked questions
How do you calculate the refinance break-even point?
Divide the closing costs by the monthly savings. With $4,800 in closing costs and $200 a month in savings, you break even in 24 months. If you plan to stay in the home longer than that, the refinance starts to pay off.
Why can a lower payment still cost more?
If you reset a loan with 22 years left to a new 30-year loan, the payment drops partly because you are paying for 8 more years. Look at the total interest of both loans, not only the payment. This calculator shows both.
What are typical refinance closing costs?
They often run around 2% to 6% of the loan amount and include the appraisal, title insurance, origination fees and points. Your lender's Loan Estimate lists them; use that number here.
Is it really free?
Yes, 100% free. No sign-up, no subscription and no usage limits. All Tools123 tools are free and run right in your browser.