Refinance Break‑even (Costs vs Savings) Calculator

Inputs

Remaining balance *

Current annual rate (%) *

Remaining term (years) *

New annual rate (%) *

New term (years) *

Closing costs ($)

Points (% of loan)

Other fees ($)

Prepayment penalty ($)

Roll costs into new loan?

Yes

Planned time in home (years) Used to compare interest over your expected horizon.

Payments exclude taxes, insurance, and mortgage insurance. Results are estimates for education only.

Results

Current monthly payment$1,677.94

New monthly payment$1,425.35

Monthly savings$252.59

Total refinance costs (incl. points & penalty)$5,250.00

Costs rolled into loan?Yes

Resulting new loan amount$255,250.00

Break‑even time 1 yr 9 mos (21 months)

Interest over your horizon (current)$101,467.67

Interest over your horizon (new)$90,527.93

Interest difference over horizon $10,939.74

Positive value means refinancing reduces interest over your stated horizon.

Key assumptions

Payments computed using standard amortization and constant monthly rate.
Points approximated as a percent of the balance; lender conventions may vary.
Taxes, insurance, HOA dues, and mortgage insurance are excluded.
If costs are rolled into the loan, principal increases and reduces monthly savings.

FAQs

It is the time it takes for monthly savings from the new loan to recoup the total refinance costs you pay, including points, fees, and any prepayment penalty.

Yes. Whether costs are paid upfront or financed, you still need to recover them with monthly savings. Financed costs also increase the new principal, which slightly reduces savings.

Extending the term usually lowers the payment but can increase total interest over the life of the loan. Use the horizon input to see interest impact over the years you expect to keep the loan.

If savings are not positive, there is no break‑even. In that case, refinancing is unlikely to make sense unless you have other goals such as cashing out or switching loan features.

No. The calculator compares principal and interest only. Property taxes, homeowners insurance, HOA dues, and mortgage insurance are separate and may not change with refinancing.

Points are approximated as a percent of balance for simplicity. Lenders may calculate points on the new loan amount and fees vary by lender and state. Always confirm with a loan estimate.

Use the horizon input. If the break‑even time is longer than you expect to keep the loan, refinancing may not be worthwhile even if the monthly payment is lower.

Refinance Break‑even Costs vs Savings Calculator

Inputs

Results

Key assumptions

FAQs

Related Calculators

Inputs

Results

Key assumptions

FAQs

1) What is a refinance break‑even point?

2) Should I include costs that are financed in the break‑even math?

3) Does resetting to a longer term skew results?

4) What if my monthly savings are negative or zero?

5) Are taxes or mortgage insurance included?

6) How accurate are the points and fee estimates?

7) What if I plan to move soon?

Related Calculators