Mortgage Refinance Calculator
Compare your current mortgage against a new refinance loan. Calculate monthly payment savings, closing cost break-even months, and true lifetime interest savings.
Current vs. New Refinance Loan Inputs
Break-Even Period: 14.0 Months (1.2 Years)
Refinance Break-Even & Net Lifetime Savings Formula
Break-Even Months = Refinancing Fees รท Monthly Payment Savings | Net Lifetime Savings = Current Remaining Interest โ New Total Interest โ Refinancing Fees- Current Monthly Payment = Amortized P&I over your current remaining loan term.
- New Monthly Payment = Amortized P&I on (Current Balance + Cash-Out Amount) at the new rate and term.
- Clearly distinguishes monthly cash-flow savings from net lifetime interest savings (since extending a loan term can lower monthly payments while increasing total lifetime interest).
Step-by-Step Worked Example
Calculation Steps:
- Current Monthly P&I = $2,120.34 vs. New Monthly P&I = $1,887.32 โ Monthly Savings = $233.02/mo
- Break-Even Period = $4,500 รท $233.02 = 19.3 months (~1 year 8 months)
- Lifetime Interest Difference = $336,101.39 โ $266,195.88 = $69,905.51 gross ($65,405.51 net after $4,500 fees)
How to Use This Calculator
- 1Enter your current mortgage balance, current interest rate, and remaining loan term in years.
- 2Enter the proposed new interest rate, new loan term in years, and estimated refinancing closing costs.
- 3Optionally include a cash-out amount if evaluating a cash-out refinance.
Assumptions & Limitations
- Assumes refinancing fees are paid upfront at closing so you can isolate pure interest and fee comparisons.
- Highlights both monthly cash-flow change and total lifetime interest change so term-extension trade-offs are transparent.
Frequently Asked Questions
Why could my monthly payment go down while my lifetime interest goes up?
If you have 20 years left on your mortgage and refinance into a brand-new 30-year loan, stretching the principal over 10 extra years lowers your monthly payment, but paying interest for 30 more years can increase total lifetime interest paid.
What is a good break-even period for a mortgage refinance?
Many homeowners look for a refinance break-even period of 24 to 36 months or less, and ensure they plan to stay in the home substantially longer than the break-even period.
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