Mortgage Refinance Break-Even Calculator
Compare mortgage refinancing against keeping your loan. Include closing costs, financed fees, monthly payments and balances at sale over the same holding period.
Enter your details and select Calculate, or load the worked example to see a complete result.
Calculate fixed-rate principal-and-interest payments and amortize both loans monthly. When closing costs are financed, they increase the new starting balance and accrue interest.
Cash savings compare cumulative loan payments plus upfront closing costs. Net savings at sale also account for the outstanding balances that must be repaid. A longer term can lower the payment while leaving more debt, so monthly savings alone do not establish whether refinancing is cheaper.
Economic break-even is the first month when cumulative payments plus remaining debt are no higher with refinancing. We search up to the longer loan term or holding period. Lifetime savings compare each loan through its own payoff and include closing costs.
Try a $300,000 balance at 7% with 300 months left, a new 6% loan over 360 months, and $6,000 in cash closing costs. The payment decreases, but the decision also depends on the remaining balance and how long you keep the loan. Change the new term to 240 months to compare a faster payoff.
Fixed-rate loans with monthly end-of-period payments; no cash-out, prepayment penalty, tax benefit, PMI, escrow, insurance, variable rates or future extra payments. Actual lender figures and payment rounding can differ. Net savings at sale compare loan costs only, assuming the same home and sale price.
Frequently Asked Questions
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