Refinance Calculator
Enter your current balance, rate and years left, then the new rate, term and closing costs, and the calculator compares the two loans. It gives the new payment, the monthly saving, how many months it takes for the saving to repay the closing costs, the interest on each loan and, for the number of years you expect to keep the loan, how much better or worse off you would be. Costs can be paid in cash or rolled into the new loan. Everything runs in your browser.
Fees, points and any appraisal
If you keep the loan for 5 years, refinancing leaves you $9,067 better off once payments made, costs and the balance still owed are counted.
The break-even point is the closing costs divided by the monthly saving: the number of months before the lower payment has repaid what the refinance cost. It is the usual rule of thumb, but it ignores that a lower rate also pays your balance down faster, which the comparison at your chosen number of years includes: it adds the payments made, any costs paid in cash, and the balance still owed under each choice. Rolling costs into the loan avoids paying cash but raises the balance and the payment. Taxes, insurance, a change of loan type and any prepayment penalty are not included, and lenders' figures can differ. This is general information, not financial advice. Everything is worked out in your browser.
Related Tools
[5 suggestions]Mortgage Calculator with Taxes, Insurance and Extra Payments
Work out your monthly mortgage payment with property tax, insurance, HOA dues and PMI, and see how extra payments cut your payoff time and interest.
Math & MoneyLoan Payment Calculator
Work out the monthly payment on a fixed-rate loan, the total interest and a full amortization schedule, with optional extra payments.
Math & MoneyInterest Rate Calculator: Find the Rate, Payment, Term or Loan
Find the interest rate of a loan from its amount, payment and term, or solve for the payment, the number of months or the loan amount instead.
Math & MoneyAPR to APY Calculator
Convert a nominal annual rate (APR) to the effective yearly rate (APY) and back for any compounding, and see the balance after a number of years.
Math & MoneyCompound Interest Calculator
See how a starting amount and monthly deposits grow with compound interest, year by year, with the effective annual rate.
Math & MoneyAbout the Refinance Calculator
A refinance replaces your loan with a new one, usually at a lower rate, in exchange for closing costs. The monthly payment of each loan comes from the standard formula: the balance times the monthly rate, divided by one minus (1 plus the monthly rate) to the power of minus the number of months. Take a 300,000 balance at 7% with 30 years left against a new 30 year loan at 6% with 6,000 of closing costs. The payment falls from 1,995.91 to 1,798.65, a saving of 197.26 a month, so the costs are repaid after 30.4 months. Over the whole loan the interest drops from 418,527 to 347,515, which is 65,012 less once the 6,000 is counted. Break-even is the closing costs divided by the monthly saving, but it is only part of the picture. A lower rate also pays the balance down faster, so the calculator also compares the net cost after the years you expect to stay, which is the payments made, any costs paid in cash, and the balance still owed. In the example, after 5 years refinancing leaves you about 9,067 better off. Refinancing into a longer term lowers the payment but can raise total interest, and the calculator warns when the new term is longer than what is left. Taxes, insurance, prepayment penalties and changes of loan type are not included, so check a lender's estimate. This is general information, not financial advice.
How do I know if refinancing is worth it?▾
Divide the closing costs by the monthly saving to get the break-even point in months, and compare it with how long you expect to keep the loan. If you will keep it well beyond break-even and the new term is not much longer, refinancing usually pays off.
Should I roll closing costs into the loan?▾
Rolling them in saves cash today but raises the balance, so you pay interest on the costs for the life of the loan. Paying in cash keeps the loan smaller, if you can spare the money.
What is the break-even point?▾
It is the number of months it takes for your monthly savings to add up to the cost of refinancing. After that point the lower payment is pure saving, as long as you still have the loan.
Does a longer term cost more?▾
Often yes. A longer loan has a lower payment but more months of interest, so the total interest can rise even at a lower rate. The calculator shows the whole-loan figure next to the payment.
Is my data uploaded?▾
No. The calculation runs in your browser and nothing you enter is sent anywhere.