When to Refinance
| Scenario | Worth Refinancing? |
|---|---|
| Rate drops 1%+ | Usually yes |
| Rate drops 0.5% | Maybe (check break-even) |
| Moving in 2-3 years | Probably not (break-even too long) |
| Shorten to 15 years | Yes, if you can afford higher payment |
Mortgage Refinance Calculator
See if refinancing your mortgage will save money. Compare current vs new loan terms with break-even analysis.
📐 How We Calculate — Learn about our calculation methodology, data sources, and quality standards.
Frequently Asked Questions
What closing costs should I expect?
Refinance closing costs typically run 2-5% of the loan amount. They include appraisal ($300-600), title insurance, origination fees, and recording fees.
What is a break-even point?
The number of months until your monthly savings exceed the closing costs. If break-even is 24 months and you plan to stay 10+ years, refinancing makes sense.
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Open →How to Use This Mortgage Refinance Calculator
Enter your current mortgage details (balance, rate, remaining term) and the proposed refinance terms (new rate, term, closing costs). The calculator shows monthly savings and break-even point.
Formula & How It Works
Monthly Savings = Current Payment – New Payment. Break-Even Months = Closing Costs / Monthly Savings. Total Savings = Monthly Savings × Remaining Months – Closing Costs.
Calculation Example
Current: $300K at 7%, 25 years left ($2,120/mo). Refinance: 5.5%, 30 years, $6,000 closing costs. New payment: $1,703. Savings $417/mo. Break-even: 15 months.
Expert Tips
The general rule: refinance if you can lower your rate by 0.75%+ and plan to stay 3+ years. Do not just look at the monthly payment — compare total interest over the life of both loans.