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Refinance Calculator | Break-Even & Monthly Savings

A refinance calculator compares your existing loan's remaining payments against a new loan's payments (with closing costs rolled in). It reports monthly savings, the break-even month where savings repay the closing costs, and total lifetime savings over the new term.

Last updated: September 2026 · Free · No sign-up required

Current loan

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New loan offer

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Results

Enter values above and click Calculate to see your result instantly.

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Quick reference

Break-even months by monthly saving (fees $6,000):

Saving/moBreak-even
$50120 mo
$10060 mo
$15040 mo
$20030 mo

schedule Break-even rule

Stay-in-the-home time must exceed break-even months, or the fees never pay back.

balance Term trade-off

A longer new term cuts the payment but can cost more over life — compare lifetime savings, not just monthly.

trending_down Rate thresholds

A drop of 0.5–0.75 pt usually clears break-even within 2–4 years at typical fees.

shield ARM to fixed

Refinancing out of an adjusting ARM into a fixed rate can be worth it even at equal payment — it caps risk.

lightbulb A real example — $300k at 6.75% → 5.75%

$300,000 balance, 24 years left at 6.75%; refi to 5.75% for 30 years with $6,000 fees rolled in.

Result: Old payment ≈ $2,068; new ≈ $1,930. Saving $138/month, break-even ≈ 43 months.

What this means: If you're likely to move within 4 years, negotiate lower fees or skip; if staying 10+, this refi saves roughly $25k net over the period you'd otherwise still owe.

Formula & methodology

Formula: New P&I = PMT(balance + fees, newRate/12, term×12); Break-even months = fees ÷ monthly savings

How refinance math works

The calculator runs two amortization payments: your current balance at your current rate for the remaining term, and the same balance plus rolled-in closing costs at the new rate for the new term. Monthly saving is the difference; break-even is closing costs divided by that monthly saving.

Example: $300,000 balance, 24 years left at 6.75%, refinanced to 5.75% for 30 years with $6,000 fees. Old payment ≈ $2,068; new ≈ $1,930 (fees financed). Saving ≈ $138/month → break-even ≈ 43 months. Extending the term cuts the payment but can raise lifetime cost — the calculator shows both.

Rules of thumb: refinance when you'll keep the loan past break-even, when the rate drop is ≥0.5–0.75%, or when moving from ARM to fixed.

Authoritative source: https://www.consumerfinance.gov/owning-a-home/process/refinance/

Frequently asked questions

When is refinancing worth it?
When monthly savings repay the closing costs before you move or pay off the loan: break-even months = closing costs ÷ monthly savings. Below ~40 months is generally strong.
Is it worth refinancing for 1 percent?
Usually yes — a 1-point drop on a $300,000 loan saves roughly $190/month, repaying $6,000 of fees in about 32 months.
Can closing costs be rolled into the refinance?
Yes — the calculator adds fees to the new balance by default, which slightly raises the new payment and lengthens break-even.
Does a longer term hurt even if the payment drops?
It can: restarting a 30-year clock adds years of interest. Check the lifetime-savings line — if it's negative, the monthly win costs you long-term.

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