Mortgage balance comparison
Current loan versus best refinance offer over time
Current mortgage
Best offer
Break-even
United States · USD
Mortgage refinance calculator.
Compare your current mortgage with a new loan to estimate payment savings, total cost and your break-even point.
Refinance offer comparison
Comparing each offer at your selected ownership horizon
| Offer | Rate | Est. APR | Points | Net costs | Payment | Break-even | Balance at horizon | Net result at horizon |
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Rate sensitivity analysis
Stress all refinance offers at lower and higher rates while keeping their terms, points and fees unchanged
| Rate change | Winning offer | Adjusted rate | Payment | Break-even | Balance at horizon | Net result at horizon | Change from entered rates |
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Refinance or pay down the current mortgage?
Compare the best refinance with using the same amount as a principal payment
| Strategy | Cash used now | Monthly payment | Balance at horizon | Estimated payoff | Net result at horizon |
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Planning estimate only—not a loan offer. The estimated APR treats entered net costs as finance charges; official APR treatment varies by fee and must come from the lender's disclosures. Escrow deposits and entered non-finance prepaids are excluded. Compare Loan Estimates using APR, lender charges, third-party fees, escrow requirements and the same time horizon.
U.S. refinancing guide
Should you refinance your mortgage?
Refinancing replaces an existing mortgage with a new loan. A lower rate may reduce the monthly principal-and-interest payment, but closing costs and a restarted loan term can offset those savings. This calculator compares both loans and estimates how long monthly savings take to recover the upfront cost.
How the refinance break-even point works
The break-even point divides upfront refinancing costs by estimated monthly payment savings. If closing costs are $6,000 and the payment falls by $200, the simple break-even point is 30 months. Refinancing may be less attractive if you expect to sell, move or refinance again before then.
When costs are financed, the calculator adds them to the new balance. That reduces upfront cash but increases both the payment and interest. Discount points are treated as an additional cost based on the new loan amount.
Monthly payment savings
A lower payment improves cash flow, but it does not automatically mean the refinance costs less overall. Compare the remaining interest and the new payoff horizon as well.
Loan term reset
Replacing a mortgage with a new 30-year term can reduce the payment partly by stretching repayment. A shorter term may cost more each month while reducing lifetime interest.
Cash-out refinancing
Cash out increases the new balance and is borrowed against home equity. Evaluate that additional borrowing separately from savings created by the rate change.
Closing costs and points
Costs can include lender fees, appraisal, title services and prepaid items. Points buy a lower rate and should be included when testing how long the refinance takes to pay for itself.
Compare official Loan Estimates
Use identical loan amounts, terms and lock periods when comparing lenders. Review the interest rate, APR, origination charges, services you cannot shop for, lender credits and cash to close. This calculator is a screening tool; official disclosures provide the transaction-specific figures.
Mortgage refinance questions
How much lower should my rate be before refinancing?
There is no universal minimum. The useful threshold depends on the balance, remaining term, closing costs, new term and how long you expect to keep the loan.
What is a good refinance break-even period?
A shorter break-even period provides more opportunity to benefit, but it should be compared with how long you realistically expect to keep the mortgage.
Does refinancing restart the mortgage?
Yes. The existing loan is paid off and replaced. Selecting a term longer than the time remaining may lower the payment but extend the payoff date.
Should I finance closing costs?
Financing costs preserves cash but raises the balance and interest. Paying upfront requires more cash and creates a measurable break-even point.
Does this calculator use APR?
No. It models cash flows from the entered note rates and costs. APR is a standardized disclosure measure and should be reviewed on each lender's Loan Estimate.