Refinance Calculator
See your new payment, monthly savings and how many months it takes to recoup closing costs when you refinance a loan.
How it works
Savings = current payment − new payment · Break-even months = closing costs ÷ monthly savings
Both payments are calculated on the same balance using standard amortization, then compared. The break-even point is how long the monthly savings take to pay back your closing costs — refinance only if you will stay past it. One caveat: stretching to a longer new term lowers the payment partly by spreading it out, so a lower monthly payment does not always mean lower total interest.
Worked example
A $250,000 balance at 7% with 25 years left pays about $1,767 a month. Refinancing to 5.5% over 30 years drops it to about $1,419 — a $348 monthly saving. With $4,000 in closing costs, you break even in about 12 months.
Frequently asked questions
When is refinancing worth it?
When you will stay in the loan well past the break-even month, and ideally when the rate drop is at least 0.5–1%. Factor in that closing costs are real money spent up front.
Does a longer term really save money?
It lowers the monthly payment but can raise lifetime interest, because you borrow for longer. To truly save, refinance to a lower rate without extending the payoff date much.
Can I roll closing costs into the loan?
Often yes — a “no-cost” refinance adds the fees to the balance or takes a slightly higher rate. You still pay them, just spread out with interest.
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This is an educational estimate, not financial advice. Confirm figures with your lender, advisor or tax professional.