Refinance Calculator
| Current loan | New loan | |
|---|---|---|
| Monthly payment | — | — |
| Time to pay off | — | — |
| Total interest | — | — |
| Points and fees | — | — |
| Break-even | — | — |
| Lifetime savings | — | — |
Estimates principal and interest only. Taxes, insurance, and PMI are not included.
See what refinancing actually does to your loan before you commit. This refinance calculator puts your current mortgage next to a new one, so the monthly payment, the closing costs, and the point where you break even all sit in one place. You bring your loan and the new offer, and it shows what changes.
Current mortgage
Monthly payment
$1,769.79
New loan
Monthly payment
$1,589.81
You save
$180/mo
Break-even in 47 months
Monthly bills
Enter the loan you have and the one you're offered. The new monthly payment shows up beside the current one, along with how much it goes down, or up. You don't need your original paperwork: the balance and the principal-and-interest payment on a recent statement are enough. The amount you first borrowed, the loan term, and the time left work too.
Savings vs. closing costs
Refinancing has costs, whether you pay them at closing or add them to the loan. The refinance calculator divides those closing costs by what you save each month, so you know how many months it takes to earn them back. If you plan to sell or move before then, a lower rate may not be worth it.
Closing costs
Pay now or add to loan
Add discount points, closing fees, or the cost of leaving your current loan early. Pay them at closing, or roll them into the new loan and see how that changes the payment and the total interest. Each choice shows up in the comparison, so you can see what it costs.
| Current | New | |
|---|---|---|
| Monthly payment | $1,769.79 | $1,589.81 |
| Time to pay off | 30 yrs | 30 yrs |
| Total interest | $357,125 | $292,331 |
| Lifetime savings | $56,393 | |
US · Canada · Australia
A lower payment can still cost more over time if the new term is longer. The comparison shows each loan's total interest and time to pay off, plus your lifetime savings, counting costs and any cash you take out. It works for US loans, and for Canadian and Australian loans too, with Canada's semi-annual compounding built in. Remortgaging in the UK? Use the remortgage calculator instead.
Comparing today's payment with a fixed rate before the next reset.
Checking whether a lower payment improves a rental's monthly cash flow.
Lowering the payment, or the years left, before the paychecks stop.
Buying out an ex or a sibling, and checking the payment on one income.
Checking whether breaking early beats waiting, penalty included.
Showing a client how a new rate changes the payment.
Pro
If rates have fallen, or your credit has improved since you borrowed, a new loan may come with a lower rate. Even a small drop can trim your payment and the interest you pay.
Pro
A shorter term usually raises the monthly payment but cuts years of interest. Try a few terms to find a payment you're comfortable with.
Pro
A cash-out refinance lets you borrow against your home equity, often at a lower rate than a personal loan or credit card.
Con
Closing costs are usually paid when the loan closes. Adding them to the new loan avoids that, but you then pay interest on them for years.
Con
Taking cash raises your balance, and the loan is secured by your home. Weigh what the money is for against a bigger payment and more interest.
Con
Advertised rates often go to borrowers with strong credit and plenty of home equity. Run the numbers again with the rate a lender actually quotes you.
The calculator uses the standard formula lenders use for fixed-rate loans. Below, it's worked through by hand for the loan in the pictures, followed by the terms used on this page. To follow along, any calculator will do.
Turn each rate into a monthly rate
6.5% ÷ 12 = 0.5417% for the current loan, and 5.5% ÷ 12 = 0.4583% for the new one. Rounded here; the calculator keeps every digit.
Work out the current payment
$280,000 at 0.5417% over 360 months comes to $1,769.79.
Work out the new payment
$280,000 at 0.4583% over 360 months comes to $1,589.81.
Find the savings and the break-even month
$1,769.79 − $1,589.81 = $179.98 saved each month. $8,400 in costs ÷ $179.98 = 46.7, so you break even in month 47.
It usually is when you keep the loan past the break-even month and your lifetime savings stay above zero. Enter your current loan and the new offer, and the calculator shows the monthly savings, the break-even month, and your lifetime savings after costs.
Freddie Mac (opens in a new tab) puts refinance closing costs at about 3% to 6% of the loan amount, depending on your lender, your credit score, and where you live. Put them in Costs and fees. Points (US) and the cost of leaving your loan early (Canada and Australia) have their own box, and all of them move the break-even month.
It depends on the loan and the lender. Some rate-and-term refinances have no waiting period. Cash-out refinances and government-backed loans usually do: Fannie Mae (opens in a new tab), for example, wants the mortgage being paid off to be at least 12 months old before a cash-out. Check the rules with your lender, then use the calculator to see if the new rate is worth it.
Applying usually means a hard credit check, which can lower your score a little for a short time. When you shop around, the Consumer Financial Protection Bureau (opens in a new tab) says inquiries for the same type of loan within 14 to 45 days of each other generally count as one. The calculator itself never checks your credit, and the numbers you enter stay in your browser.
There is no fixed rule. An old rule of thumb says one percentage point, but a smaller drop can pay off on a large balance with low costs, and a bigger one may not if you move soon. Enter your real numbers and look at the break-even month instead.
No. It compares principal and interest only, so property taxes, homeowners insurance, and mortgage insurance are left out. If your monthly payment includes them, enter only the principal and interest. Taxes and homeowners insurance don't usually change when you refinance, but mortgage insurance can, so ask your lender about it.
It uses the standard amortization formula, with Canada's semi-annual compounding built in. The results are estimates, and a lender's figures can differ slightly because of rounding, the closing date, and fees. For the closest comparison, use the numbers from your actual quote.
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