Monthly saving vs closing costs
Refinance Break-Even Calculator
A lower rate only helps if you stay long enough to recover the closing costs. This compares your current payment with the refinanced one and divides the cost of switching by the monthly saving.
How this is calculated
- Both payments are amortised over their own remaining terms, so a longer new term is not flattered.
- Break-even is closing costs divided by the monthly saving; under roughly 24-36 months it is usually worth doing.
- The calculator also shows what the longer term does to lifetime interest, which is where rate-and-term refis quietly cost money.
Before you go
Does a lower payment always mean I saved money?
No. Stretching a 27-year balance back to 30 years lowers the payment while adding interest. Compare total interest as well as the monthly figure.
What counts as closing costs?
Lender fees, appraisal, title, recording and any points. A cash-out refinance adds to the balance, so include the amount you are taking out when comparing.
Should I refinance to a shorter term?
It raises the payment and cuts lifetime interest, which is the opposite trade to a payment-reduction refi. Decide which of the two you are actually solving for before you compare quotes.
Estimation only. Rates, taxes and fees in your actual offer will differ, and this tool is not financial advice or a loan quote.