Free mortgage refinance calculator
Compare your current mortgage against a refinance offer — find monthly savings, break-even point, and net savings over your stay, updated live, as you type.
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Does not include PMI, property tax, or insurance changes. Consult a mortgage professional before refinancing.
Results are estimates. Consult a professional.
How the mortgage refinance calculator works
Refinancing replaces your existing mortgage with a new one at a different rate, term, or both. The calculator computes your new monthly payment, your monthly savings, how many months it takes to recoup the closing costs, and your total savings over the remaining life of the loan.
Worked example: $280,000 remaining, 7.5% → 6.75%
A homeowner has $280,000 remaining on a 7.5% loan with 25 years left. A lender offers to refinance into a new 30-year loan at 6.75% with $5,000 in closing costs.
Break-even months by closing cost and monthly savings
Break-even is simply closing costs divided by monthly savings. The table shows it for common combinations. Find your row (monthly savings) and column (closing costs) to read your break-even period directly.
| Monthly savings | $3,000 closing | $5,000 closing | $8,000 closing |
|---|---|---|---|
| $100/mo | 30 months (2.5 yr) | 50 months (4.2 yr) | 80 months (6.7 yr) |
| $150/mo | 20 months (1.7 yr) | 33 months (2.8 yr) | 53 months (4.4 yr) |
| $200/mo | 15 months (1.3 yr) | 25 months (2.1 yr) | 40 months (3.3 yr) |
| $300/mo | 10 months (0.8 yr) | 17 months (1.4 yr) | 27 months (2.3 yr) |
Source: CFPB refinancing guide; break-even = closing costs ÷ monthly savings. Assumes consistent payments and no prepayment penalty.
General rule of thumb: break-even under 24 months is a strong case for refinancing. Over 48 months, you need high confidence you will stay in the home and the loan long enough to benefit.
Tips for evaluating a mortgage refinance
A lower rate is not automatically a good reason to refinance. The break-even analysis is the starting point, but five other factors shape the real outcome.
- Match the new term to your goals — refinancing into a fresh 30-year lowers your payment but restarts the clock. If your goal is to pay off the home by retirement, match the new term to the years remaining, not the maximum allowed.
- The 1% rule is a shortcut, not a law — the common advice is to refi when rates drop 1 percentage point. In reality, break-even is what matters. A 0.5% drop on a large loan with low closing costs can break even in 18 months and justify refinancing.
- Include all closing costs — lenders sometimes advertise 'no-cost' refis where fees are rolled into the loan balance or offset by a higher rate. Model the true all-in cost, including the cost of the higher rate over time.
- Check your prepayment penalty — loans originated before 2014 may carry prepayment penalties. Read your current loan documents before submitting a refinance application.
- Don't reset the clock unnecessarily — if you have 20 years left and refi into a new 30-year, you extend your total payoff by 10 years. The lower monthly payment is real, but so is the decade of extra payments.
Accuracy and limitations
Results assume a clean refinance into a new fixed-rate loan with no cash-out, no skip-a-payment promotions, and closing costs paid upfront (not rolled into the new loan balance). If closing costs are financed, the true break-even is longer because you pay interest on those costs as well. The calculator does not model tax implications — mortgage interest deductibility may shift after refinancing if the loan balance or tax bracket changes.
Not financial advice — consult a mortgage professional for your specific situation.
Mortgage refinance terms defined
About this mortgage refinance calculator
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