Refinance Calculator
Compare your current loan to a refinance offer to see your monthly savings, total interest saved, and how many months it takes to recoup your closing costs.
Monthly savings
$231.73
Breakeven on closing costs
17.3 months
Current payment
$1,766.95
New payment
$1,535.22
Total interest saved
$69,519
How it's calculated
This calculator amortizes your current loan's remaining balance over its remaining term at its current rate, and separately amortizes the same balance over the new loan's term at the new rate — the same underlying math used for any installment loan.
Monthly savings is simply the difference between those two payments. Breakeven time is how many months of savings it takes to recoup your closing costs: closing costs ÷ monthly savings.
If the new loan's payment isn't actually lower (for example, a much shorter term can raise the payment even at a lower rate), there's no breakeven to calculate — refinancing wouldn't reduce your monthly cost in that case.
Worked example
A $250,000 loan with 300 months (25 years) remaining at 7% has a monthly payment of about $1,766.95.
Refinancing that same balance into a new 300-month loan at 5.5% drops the payment to about $1,535.22 — a monthly savings of $231.73, totaling about $69,518.78 in interest saved over the life of the loan. With $4,000 in closing costs, the breakeven point is about 17.3 months.
Frequently Asked Questions
- What's a good breakeven period for a refinance?
- It depends on how long you plan to stay in the loan — if you'll keep the loan well beyond the breakeven point, the refinance is likely worth it. A breakeven under 2-3 years is often considered reasonable for most homeowners.
- Should I reset my loan to a new 30-year term when refinancing?
- Resetting the clock lowers your monthly payment but can increase total interest paid, since you're spreading the balance over more years again. Matching your new term to your remaining term (or shorter) usually saves more in total interest, at the cost of a smaller monthly payment reduction.
- What counts as closing costs on a refinance?
- Typical refinance closing costs include loan origination fees, appraisal fees, title insurance, and recording fees — often 2-5% of the loan amount, though this varies by lender and location.