Mortgage · refinance

Free mortgage refinance calculator

Compare your current mortgage to a new rate and term. See your monthly saving, how long until refinancing pays for itself, and the interest you’d save over the life of the loan.

Break even in —

Current payment: —
New payment: —
Monthly saving: —
Lifetime interest: —

Total paid over time — keep vs. refinance

Keep current loan Refinance (incl. closing)

How refinancing works and what this calculator compares

Refinancing replaces your existing mortgage with a new one, ideally at a lower rate. You pay off the old loan and start the new one on its own terms — a fresh balance, a new rate, and a new repayment schedule. In exchange for the better rate you pay closing costs upfront, so a refinance is really a trade: money now for savings later. The whole question is whether those savings outrun the cost.

This calculator puts the two loans side by side. It takes your current balance, rate, and the years you have left, then compares them to a new rate and term. From there it works out four things that actually matter: your monthly saving (current payment minus new payment), the breakeven — how many months of that saving it takes to cover your closing costs — and the lifetime interest difference once those costs are baked in. The chart traces total paid over time for both paths so you can see the moment the refinance pulls ahead.

How to use this calculator

Every input comes straight off your mortgage statement and a lender quote:

Balance left. What you still owe today, not the original loan amount.
Current rate. The interest rate on your existing mortgage.
Years left. How many years remain on your current loan — a loan taken three years ago on a 30-year term has 27 left.
New rate. The rate you’ve been quoted on the refinance.
New term. The length of the new loan. This is the input people skip past, and it’s the one that quietly decides whether you come out ahead.
Closing costs. The upfront fees to refinance — origination, appraisal, title, and recording charges, often a few thousand dollars.

Change any field and the results update live. Nothing leaves your browser, so you can paste in real numbers without worry.

The breakeven point and why it matters

Breakeven is the single most useful number on the page, and the math behind it is plain: closing costs divided by monthly saving. Spend $5,000 to refinance and save $200 a month, and you break even in 25 months. Before that point you’re still in the hole on the upfront fees; after it, every month is genuine savings. The calculator shows this as a date and draws it on the chart as the spot where the refinance line dips below the line for keeping your current loan.

Breakeven matters most if there’s any chance you’ll move. The average homeowner doesn’t stay put forever, and if you sell or refinance again before you reach breakeven, you’ve paid the closing costs without collecting the payoff. As a rule of thumb, only refinance if you’re confident you’ll keep the loan well past its breakeven month. If your timeline is shorter than the breakeven, the deal costs you money no matter how good the rate looks.

The term-reset trap

Here’s where a tempting refinance can backfire. Say you’re seven years into a 30-year loan and you refinance into a new 30-year term at a lower rate. The monthly payment drops, which feels like a win — but you’ve just stretched the remaining 23 years back out to 30. You’ll make payments for seven extra years, and a lower rate spread over a longer time can add up to more total interest, not less.

That’s why this tool reports lifetime interest, not just the monthly number. A falling payment can hide a rising total. The fix is straightforward: refinance into a term that matches the years you have left rather than resetting to a fresh 30, or take the lower rate on a new term but keep paying the old, higher amount so you knock the principal down faster. Watch the lifetime figure in the results — if it says “cost” instead of “save,” the term reset is eating your rate savings.

When refinancing makes sense

A few situations reliably justify the cost. The clearest is a real rate drop — if market rates have fallen well below what you’re paying, a refinance can cut both your payment and your lifetime interest, especially on a matching or shorter term. Refinancing to remove private mortgage insurance is another win: once you’ve built enough equity, dropping PMI can save real money even at a similar rate. Shortening your term — say from 30 years to 15 — usually raises the payment but slashes total interest and gets you mortgage-free sooner.

Be more careful with cash-out refinances, which let you borrow against your equity for renovations or to pay off other debt. They can make sense, but you’re increasing the balance on your largest debt and turning unsecured balances into debt secured by your home. Run the numbers honestly, and never assume a lower monthly payment means you’re saving overall.

Related tools & guides

Pair this with the mortgage calculator to model a new loan from scratch, or the home affordability calculator if you’re weighing a move instead of a refinance. To see what putting extra toward principal does, try the early payoff calculator, and check the credit score tool before you apply, since your score drives the rate you’ll be offered. Browse the full set of money calculators, and for the bigger decision read our guide on whether you should pay off your mortgage early. This tool is for education, not financial advice.

Refinance calculator FAQ

When is it worth refinancing?

Refinancing is usually worth it when the new rate is meaningfully lower than your current one — often a drop of around three-quarters of a point or more — and you’ll stay in the home long enough to recoup the closing costs. It can also pay off when refinancing lets you drop private mortgage insurance, switch out of an adjustable-rate loan, or shorten your term. The deciding factor is the breakeven: if you’ll move or sell before the monthly savings cover the closing costs, the refinance loses money.

What is the breakeven point on a refinance?

The breakeven point is how long it takes for your monthly savings to pay back the upfront closing costs. The math is simple: divide the closing costs by the monthly saving. If you spend $5,000 to close and save $200 a month, you break even in about 25 months — a little over two years. Stay past that point and the refinance is pure savings; leave before it and you’ve lost money on the deal.

How much does it cost to refinance?

Closing costs on a refinance typically run about 2% to 6% of the loan amount, which often lands in the $3,000 to $7,000 range on a mid-size mortgage. The bill includes lender origination fees, an appraisal, title work, and various recording and processing charges. Some lenders offer a “no-closing-cost” refinance, but they recover the money by charging a higher rate or rolling the costs into your balance, so it isn’t actually free.

Does refinancing reset my loan term?

Yes, unless you choose otherwise. A standard refinance starts a brand-new term — often a fresh 30 years — even if you were already a decade into your old loan. That resets the clock and stretches your payments back out, which is why a lower monthly payment can still mean more total interest. To avoid the trap, refinance into a term that matches the years you have left, or make extra principal payments to keep your original payoff date.

Will refinancing save me money overall?

Not always. A lower rate cuts your interest, but if you reset to a longer term you may pay more interest in total even though the monthly payment drops. This calculator separates the two: it shows your monthly saving and, just as importantly, the lifetime interest difference after closing costs. Watch the lifetime number — that’s the figure that tells you whether the refinance genuinely saves money or just rearranges when you pay it.

Does refinancing hurt my credit?

Only slightly and only briefly. The lender runs a hard inquiry when you apply, which can shave a few points off your score for a few months, and opening a new loan lowers the average age of your accounts. Rate-shopping within a short window — usually 14 to 45 days — counts as a single inquiry, so comparing several lenders won’t stack up multiple hits. For most people the effect is small and fades well before the refinance pays for itself.