Refinance Calculator
Estimate whether refinancing your mortgage could reduce payments and recover closing costs.
Current Mortgage
Years left on current loan
Principal & interest only (optional override)
Refinance Scenario
Typically 15 or 30 years
Typically 2–5% of loan balance
Current Loan
Refinanced Loan
Break-Even Timeline
You save $330.21/month. Closing costs of $6,000 are recovered in 19 months. If you stay in your home beyond that point, refinancing saves you money.
Understanding Refinancing
- →Refinancing replaces your current mortgage with a new one, ideally at a lower interest rate. This can reduce monthly payments and total interest paid.
- →Closing costs typically run 2–5% of the loan balance. The break-even point tells you how long it takes for monthly savings to cover those upfront costs.
- →Extending your loan term lowers monthly payments but may increase total interest paid over the life of the loan — even at a lower rate.
- →This calculator is educational and does not constitute financial or mortgage advice. Actual loan terms vary by lender, credit score, and market conditions.
Learn More
Understanding This Calculator
What this calculator does
This calculator shows whether refinancing your mortgage saves money by comparing your current loan's remaining cost to a new loan at a lower rate, including closing costs and the break-even point.
How to use the results
- 1.Enter your current loan balance, rate, and remaining term.
- 2.Enter the new rate, term, and refinance closing costs.
- 3.The result shows monthly savings, total savings, and the break-even month.
Worked example
Refinancing a $250,000 balance from 6.5% to 5.5% with $4,000 in closing costs: monthly savings ~$150; break-even at ~27 months. Worth it if you stay longer than that.
Important assumptions & limitations
- •Assumes you keep the new loan to term; selling before break-even loses the benefit.
- •Closing costs vary (typically 2–5% of the loan); enter your actual quote.
- •A cash-out refinance or term change alters the comparison — this calculator models a rate-and-term refinance.
Frequently asked questions
Learn More About Mortgages and Home Buying
Interested in learning more about refinancing, mortgage rates, home affordability, and long-term homeownership planning? Visit MortgageWizardTools.com for additional beginner-friendly guides and educational resources.
Disclaimer: This calculator is for educational purposes only. Results are estimates based on simplified assumptions and do not account for PMI, escrow, tax deductions, prepayment, or all lender fees. Consult a qualified mortgage professional before making any refinancing decisions.
Mike Starr
Founder, FinanceWizardTools · M.S. Organizational Management