Refinance Calculator
Compare your current mortgage against a new rate: monthly savings, total interest difference, and the break-even month where closing costs pay for themselves.
The break-even rule
Refinancing trades an upfront cost for a lower ongoing payment. The deal makes sense if you keep the loan long enough for savings to cover the cost:
Balance $300,000 at 7.25% ($2,047/mo) → refinance to 6.0% for 30 years with $6,000 closing costs.
New payment: $1,799/mo → saving $248/mo
Break-even: 6,000 ÷ 248 ≈ 24 months. Stay longer than 2 years and the refinance pays off.
Watch the term reset
A fresh 30-year loan lowers the payment partly because it stretches repayment out again — which can increase lifetime interest even at a lower rate. The "lifetime difference" figure above compares the total remaining interest of both paths, including closing costs, so you can see the whole picture. If the lifetime number is negative while the monthly number looks good, consider a 15- or 20-year refinance term instead, or keep paying your old payment amount on the new loan (an instant extra-payment plan).
Frequently asked questions
When is refinancing worth it?
When you'll keep the loan past the break-even point (closing costs ÷ monthly savings). $5,000 in costs and $250/mo savings breaks even in 20 months.
How much does it cost to refinance?
Typically 2%–6% of the loan amount for origination, appraisal, title, and recording — roughly $6,000–$18,000 on a $300,000 loan.
Does restarting a 30-year clock cost me money?
It can — paying for longer can outweigh the lower rate. Compare lifetime interest (shown above) or choose a shorter new term.
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Note: Estimates assume fixed rates and consistent payments; actual quotes include fees and points that vary by lender. Not financial advice. Last reviewed: July 2026.