Mortgage Refinance Calculator
See your new payment, monthly savings, and break-even point.
Results update as you type.
This calculator is for illustrative purposes only. Actual rates, fees and terms vary by lender. Consult a qualified financial adviser before making borrowing decisions.
How it works
Refinancing replaces your existing mortgage with a new loan, usually to capture a lower interest rate, shorten or extend the term, or free up monthly cash. A mortgage refinance calculator makes the decision concrete by computing your new principal and interest payment from your current balance, then comparing it against what you pay today to reveal the monthly saving and, crucially, how long it takes to earn back the cost of refinancing. That last figure, the break-even point, is what separates a smart refinance from a costly one. Refinancing is not free: closing costs for the new loan often run into the thousands. Dividing those costs by your monthly saving shows how many months you must keep the loan before the savings overtake the upfront expense. If you plan to sell or refinance again before that point, the deal may not pay off. The math works because the new payment follows the same amortization logic as any mortgage, so a lower rate or different term produces a predictable new figure. Weighing the monthly saving against the break-even horizon lets you judge whether a refinance genuinely helps. Owners should also consider that extending the term can lower the payment while raising total interest, so the monthly saving alone never tells the whole story.
New payment via amortization; break-even = closing costs ÷ monthly savings
The new principal and interest payment comes from the standard amortization formula applied to your current balance at the new rate and term, spreading repayment evenly. Subtracting that payment from your existing one gives the monthly saving. Dividing the closing costs by that saving tells you how many months of lower payments it takes to recoup the upfront expense, which is the moment refinancing starts putting money back in your pocket.
Source:Standard amortization formula
We review all our tools from time to time to ensure accuracy.
Worked example
How to use this calculator
- 1
Enter your values
Enter current loan balance, current monthly payment, new interest rate and new loan term.
- 2
Adjust the options
Adjust refinance closing costs if they apply — sensible defaults are already set.
- 3
Read your result
New payment updates instantly as you type — no button to press.
Frequently asked questions
What is the break-even point on a refinance?
The break-even point is the number of months it takes for your accumulated monthly savings to equal the closing costs you paid to refinance. Divide the closing costs by the monthly saving to find it. If your break-even is 32 months, you need to keep the new loan at least that long to come out ahead. Refinancing rarely pays off if you plan to move or refinance again sooner.
Does a lower monthly payment always mean I save money?
Not always. A lower payment can come from a genuinely lower rate, which does save money, or from stretching the balance over a longer term, which reduces the monthly figure while increasing the total interest you pay over the life of the loan. Look beyond the payment to the interest rate, the new term, and the total cost. A smaller payment on a longer loan can quietly cost more overall.
What closing costs come with refinancing?
Refinancing carries many of the same fees as an original mortgage: loan origination, appraisal, title search and insurance, recording, and sometimes points to buy down the rate. These commonly total a few percent of the loan balance. Some lenders offer no-closing-cost refinances that fold the fees into the balance or the rate instead, which lowers upfront cash but raises the loan or monthly payment, so compare total cost carefully.
Should I refinance to a shorter term?
Refinancing from a 30-year to a 15-year term usually raises your monthly payment but sharply reduces total interest and builds equity faster, which suits owners who can afford the higher payment and want to own outright sooner. Extending the term does the opposite, lowering payments while increasing lifetime interest. The right choice depends on your budget and goals, so compare both the monthly figure and the total interest before deciding.
When is refinancing usually worth it?
Refinancing tends to make sense when you can lower your interest rate meaningfully, you plan to stay in the home past the break-even point, and the monthly savings justify the closing costs. It can also help if you want to switch from an adjustable to a fixed rate, remove mortgage insurance after gaining equity, or shorten the term. Run the numbers on your specific loan rather than relying on a general rate-drop rule of thumb.