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Home, Property & Mortgages

Mortgage Refinance Calculator

Decide whether refinancing pays off: compare old and new payments, the break-even month for closing costs and the lifetime cost difference.

Your inputs

Results

Monthly payment change (saving)

$347.48

Current payment
$1,766.95
New payment
$1,419.47
Months to recover closing costs
12
Lifetime cost difference (new interest + costs − remaining current interest)
-$15,072.00

✓Exact calculation — rounded only for display

Notes for this result

  • Refinancing lowers your total cost over the life of the loan under these assumptions.

Inputs are never added to links for financial, salary or health calculators.

What this calculator does

Refinancing replaces your loan with a new one, ideally at a lower rate. Closing costs mean it takes time to come out ahead, and resetting the term can raise lifetime interest.

Formula and method

Monthly saving = current payment − new payment Break-even months = ceiling(closing costs ÷ monthly saving) Lifetime difference = new total interest + costs − remaining interest on the current loan

Worked example

Calculated by this tool with its default inputs:

Inputs

  • Current loan balance: 250000 (any currency)
  • Current rate: 7 %
  • Months remaining on current loan: 300
  • New rate: 5.5 %
  • New term: 30 years
  • Refinance closing costs: 4000 (any currency)

Results

  • Monthly payment change (saving): 347.48
  • Current payment: 1,766.95
  • New payment: 1,419.47
  • Months to recover closing costs: 12
  • Lifetime cost difference (new interest + costs − remaining current interest): -15,072

How to read the results

If you expect to sell or refinance again before the break-even month, the refinance probably does not pay.

Assumptions and limitations

  • Cash-out refinancing and points are not included (see the mortgage points calculator).

Financial results are estimates based on the inputs and assumptions shown. They are not financial advice; confirm figures with your lender, provider or a qualified adviser before making decisions.

Questions

Why can refinancing cost more even with a lower rate?

Restarting a 30-year term spreads repayment over more years, so total interest can rise even as the payment falls.

Methodology and verification

Result type
Exact mathematical calculation (rounded only for display)
Formula version
1.0
Automated verification
3 reference and validation test cases, checked against independently computed values. The site cannot be built if any of them fail.
Editorial review
Awaiting human editorial review. The explanation was drafted with AI assistance; the formula and examples are verified by the automated tests above.

Privacy

Everything you enter is calculated in this browser and is not sent to Numerith or anyone else. Because this calculator can involve personal financial or health details, your inputs are never added to share links or saved to history. Privacy policy