Refinance Calculator

This refinance calculator compares your current mortgage to a potential new one — showing monthly savings, break-even period, and total lifetime savings after closing costs. It gives you the number that actually matters: how many months until refinancing pays for itself.

How the Break-Even Calculation Works

Break-even months equals closing costs divided by monthly payment savings. If refinancing saves $200/month and costs $4,800 in closing costs, you break even after 24 months. Every month after that, the savings are pure benefit. If you plan to sell or move before the break-even point, refinancing will cost you money net-net, regardless of how good the new rate looks.

Why Resetting to 30 Years Can Be Costly

Refinancing from year 10 of a 30-year mortgage into a new 30-year term extends your total repayment timeline. Even with a lower rate, you may end up paying more in total interest because you've added years back to the loan. The calculator shows total paid under both scenarios so you can see this tradeoff clearly — not just the monthly savings.

Rate Reduction vs. Term Shortening

Two valid refinancing goals produce very different results. Refinancing to a lower rate on the same term reduces monthly payment and total cost. Refinancing to a shorter term (say, 30 years to 15 years) may increase the monthly payment but dramatically cuts total interest — often more than a rate reduction alone. If cash flow allows, a rate-and-term combination that shortens the loan is usually the most financially efficient option.

When to Refinance Now vs. Wait

Interest rate environments shift. If rates are trending down, waiting may produce better savings; if they're trending up, locking in now matters. The break-even period shown by this calculator should be weighed against your best estimate of how long you'll keep the property. For help understanding your new payment's effect on monthly budget, see the paycheck calculator or amortization schedule calculator.