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Refinance Calculator

Your current loan

Time left on the loan

Part years are fine: 26.5 is 26 years, 6 months.

The new loan

Freddie Mac's 30-year average for Oct 1, 2026. Enter the rate you're quoted.

New Loan, All In: $695,685.98
Balance: $280,000.00
New Interest: $409,685.98
Closing Costs: $6,000.00
New Monthly Payment$1,915.79
Current Payment$2,159.58
Monthly Change$243.78 less
Break-Even on Closing Costs2 yrs, 1 mo
Interest left on current loan$419,703.45
Interest on new loan$409,685.98
Closing costs$6,000.00
Refinancing costs overall$4,017.47 less
Current loan paid off in27 years
New loan paid off in30 years
Keep paying $2,159.58 a month on the new loan and it's paid off in 21 yrs, 4 mo, costing $142,247.06 less in interest and closing costs than keeping your current loan.

Compares principal and interest only: taxes, insurance and any mortgage insurance stay with the home either way. Break-even counts the months until your payment savings add up to the closing costs.

Saving is free — sign in and your calculations follow you to any device.

Estimates for informational purposes only — not financial advice.

Compare scenarios

Pin the numbers on screen, change any input, and see them side by side.

Is Refinancing Worth It?

Refinancing pays off your current mortgage with a new loan, ideally at a lower rate. It isn't free: you pay many of the same closing costs as on your first mortgage, and a new loan restarts the clock on your term. This calculator puts the two paths side by side. It shows your new payment and the monthly change, the month your savings cover the closing costs, and the interest left on each loan, and it warns you when a lower payment comes with a higher total cost.

How this calculator works

Compares keeping your current loan with replacing it: the new monthly payment, the change from today, the month your savings cover the closing costs, and the interest left on each path.

How it calculates

  1. Works out your current monthly principal and interest. From the years left, it is the payment that clears your balance in that time; from the original loan, it is the payment on your note. Either way: P = L × r ÷ (1 − (1 + r)^−n), with r the annual rate ÷ 12 and n the number of months.
  2. Pays down your current balance at that payment, month by month, to find when it ends and the interest still to come.
  3. Sizes the new loan (your balance, plus any cash out, plus the closing costs if you add them to the loan) and finds its payment with the same formula at the new rate and term.
  4. Adds up the difference between the two payments each month until it covers the closing costs: that month is the break-even.
  5. Compares the lifetime cost: interest on the new loan plus closing costs, against the interest left on the current loan. When the payment falls but this total rises, the results say so.

What it assumes

  • Both loans are fixed-rate with monthly payments, and each month's interest is the annual rate ÷ 12 on the balance.
  • Principal and interest only: property taxes, home insurance and mortgage insurance are left out, since they come with the home either way.
  • No prepayment penalty on the current loan, and no adjustment for inflation or for what the money could earn elsewhere.
  • The new rate starts at Freddie Mac's weekly 30-year average, which tracks purchase loans to borrowers with good credit and 20% down; your quote may differ.

Sources

Copy and figures last reviewed .

How we build and check all our calculators

Frequently Asked Questions

How do I know if refinancing is worth it?

Check two things. First, the break-even month: how long your monthly savings take to cover the closing costs. If you might sell or refinance again before then, the refinance will likely cost more than it saves. Second, the total cost: add the closing costs to the interest on the new loan and compare that with the interest left on your current loan. A refinance that wins on both counts deserves a closer look; one that wins only on the monthly payment deserves a second thought.

Why can a lower payment still cost more overall?

Because a new loan restarts the clock. Take $280,000 at 8.25% with 27 years left, refinanced into a 30-year loan at 7.28% with $6,000 of closing costs added to the loan. The payment drops by $202.73 a month, but the three extra years of payments add about $4,760 in interest and closing costs over the life of the loan. The calculator warns you when this happens. A shorter term, or paying your old payment amount on the new loan, keeps most of the savings from the lower rate.

Should I pay closing costs upfront or add them to the loan?

Paying them at closing keeps the new loan smaller, so you pay no interest on the costs themselves. Adding them to the loan saves cash today, but you borrow more, the payment goes up and the costs collect interest for the whole term. Adding $6,000 of costs to a 30-year loan at 7.28% raises the payment by about $41 a month. Switch between the two options here to see how each changes your break-even month and total cost.

How is the break-even month calculated?

The calculator adds up the difference between your current payment and the new one, month by month, until the total covers your closing costs. With a monthly saving of $243.78 and $6,000 of costs paid at closing, that happens in month 25. If the new payment isn't lower, as with many cash-out refinances, monthly savings never repay the costs, and the calculator says so. Break-even ignores what the money could have earned elsewhere, so the real break-even comes a little later.

What should I know about a cash-out refinance?

A cash-out refinance replaces your mortgage with a bigger one and pays you the difference. It is still borrowed money: the new loan, the payment and the interest all grow, and you repay the cash over the full new term, possibly at a higher rate than your current mortgage. Enter the amount in Cash Out to see the new payment and the added interest. If you want to keep your current mortgage and rate, compare it with a home equity line of credit.

Term Definitions

Balance Owed

The unpaid principal on your current loan, from your latest statement or your servicer's website. It isn't quite the same as a payoff quote, which adds the interest owed up to the payoff date and any fees.

Current Interest Rate

The interest rate on your current loan, from your statement or loan documents. Use the interest rate rather than the APR: the interest rate is what sets your payment and the interest still to come.

Time Left on the Loan

The calculator needs the time left to work out your current payment and the interest still to come. Enter the years left if you know them (26.5 is 26 years and 6 months). Or enter the original loan amount, term and first payment date: the calculator counts the payments made, and uses the payment on your original loan.

Original Loan Amount

The amount on your note when the loan began. With the original term and your rate, it sets the monthly principal and interest payment you have been making. The calculator also shows what you would owe now if every payment had been made on schedule, as a check on the balance you enter.

Original Term (Years)

The term on your note when the loan began, such as 30 or 15 years. With the first payment date, it tells the calculator how many payments are left.

First Payment Date

The due date of your current loan's first payment, from your loan documents. With the original term, it tells the calculator how many payments you have made and how many are left.

New Interest Rate

The interest rate on the refinance loan. It starts at Freddie Mac's latest weekly average for 30-year fixed loans, which tracks home purchase loans to borrowers with good credit and 20% down. Your quote depends on your credit, your equity and the lender, so enter the rate you are offered.

New Loan Term

The term of the refinance loan. Starting a new 30-year loan on a balance with 27 years left lowers the payment partly by stretching it over three more years, and those years add interest. A term close to the time left on your current loan, or shorter, shows what the lower rate saves on its own.

Closing Costs

Refinancing has many of the same costs as your first mortgage, such as lender fees, an appraisal, title insurance and recording fees. Your Loan Estimate lists them. You can pay them at closing or add them to the new loan; adding them means you borrow more and pay interest on them for the whole term.

Cash Out

In a cash-out refinance the new loan is larger than the balance you owe, and you receive the difference. It is still borrowed money: it raises the new loan, the payment and the interest, and you repay it over the new loan's whole term.

Break-Even Month

The month in which your payment savings, added up, first cover the closing costs. If you expect to sell or refinance again before then, the refinance may cost more than it saves. A break-even date says nothing about the total interest, though: a lower payment over a longer term can break even quickly and still cost more over the life of the loan.

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