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Mortgage Calculators

Mortgage Refinance Calculator

Calculate monthly savings, break-even point, and lifetime interest if you refinance your mortgage.

Includes closing costs in the break-even calculation, the way it should be done.

$
%
yr
%
yr
$
Estimated monthly savings
$370 / mo saved
Break-even in 1 yr 4 mo.
Current monthly payment
$2,168
New monthly payment
$1,799
Lifetime interest (current)
$350,526
Lifetime interest (new)
$347,515
Net lifetime savings
-$2,988
Break-even
1 yr 4 mo
Explain this result

Turn the numbers above into plain-language takeaways. Educational only — not financial advice.

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Overview

How the Mortgage Refinance Calculator Works

Refinancing only makes sense if you'll stay in the home long enough to recover the closing costs. This calculator gives you the break-even month plainly — the point where cumulative savings catch up to what you paid to refinance — and the lifetime interest difference between keeping your current loan and replacing it.

Formula

The Math Behind the Calculator

Monthly savings = Current monthly payment − New monthly payment. Break-even months = Closing costs ÷ Monthly savings. Net lifetime savings = (Current lifetime interest − New lifetime interest) − Closing costs.

Example

A Worked Example

Refinancing a $300,000 balance from 7.25% with 25 years left to 6.00% over a new 30-year term drops the payment from about $2,170 to $1,799 — a $371 monthly savings. With $6,000 in closing costs, you break even in about 16 months. If you stay in the home five more years, you save roughly $16,000 net.

How to use

How to Use the Mortgage Refinance Calculator

  1. 1Enter your current loan balance, current rate, and years remaining on your existing mortgage.
  2. 2Enter the new rate and new term you've been offered.
  3. 3Add realistic closing costs — typically 2–5% of the new loan amount.
  4. 4Compare the break-even month to how long you actually plan to stay in the home.
Interpretation

What the Results Mean

  • Monthly savings is the immediate cash flow improvement.
  • Break-even months tells you when the refi starts paying you back. If you'll move before that month, the refinance loses money.
  • Net lifetime savings accounts for the fact that resetting to a 30-year term can sometimes increase total interest even when the monthly drops.
Keep exploring

Smart Next Steps

What to explore next
Avoid

Common Mistakes to Avoid

  • Ignoring closing costs and rolling them into the loan without noticing the new balance is higher.
  • Refinancing a 25-year remaining loan into a brand-new 30-year term and paying more interest overall.
  • Refinancing for a small rate drop when you plan to move within 1–2 years.
Keep going

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FAQ

Frequently Asked Questions

When does refinancing make sense?+

When the rate drop is meaningful (often 0.5–1% or more), closing costs are reasonable, and you plan to stay past the break-even month.

Should I roll closing costs into the loan?+

It saves cash today but increases the balance and total interest. The break-even still applies — just verify net savings stay positive.

Does refinancing reset my term?+

Yes, unless you specifically request the same remaining term. Match terms when possible to avoid stretching interest over more years.

Financial Disclaimer

This calculator is for educational and estimation purposes only. It does not provide financial, mortgage, tax, investment, or legal advice. Actual rates, payments, taxes, fees, insurance costs, eligibility, and loan terms vary by lender, location, credit profile, and market conditions. Always compare official offers and consult a qualified professional before making financial decisions.

Last updated June 2026 · Prepared by the mCalculator Editorial Team