Mortgage Refinance Calculator
Compare your current mortgage with a refinance: the change in monthly payment, how many months the closing costs take to recover, and the total cost difference over the life of both loans.
Last updated: October 2026
Refinance Savings
$156.19 per month
This calculator gives an estimate for general information only. It is not financial, tax or investment advice. Check the figures with a qualified professional before making decisions, and follow the rules that apply where you live.
Formula below · 1 source (CFPB) · Updated Oct 2026
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About this calculator
Both payments use the standard fixed-rate amortization formula, M = P × r ÷ (1 − (1 + r)^−n), where P is the balance, r the monthly rate (annual rate ÷ 12) and n the number of monthly payments. The current loan is amortized over the years you have left; the new loan over its new term, starting from the same balance.
Break-even
Refinancing costs money up front: lender fees, appraisal, title and recording. Break-even months = closing costs ÷ monthly savings. If you expect to keep the new loan (and the house) longer than that, the lower payment repays the costs; if you might sell or refinance again sooner, it may not.
Monthly savings versus total savings
A lower payment is not the same as a cheaper loan. Stretching the balance over a new 30-year term can cut the payment while adding years of interest. The total-savings view compares everything you would still pay on the current loan (payment × months left) with everything you would pay on the new one plus the closing costs. A negative number means the refinance costs more over its life even if the monthly payment is lower.
Assumptions
Both loans are fixed-rate and fully amortizing; taxes, insurance and PMI are left out because they do not change with the refinance. Closing costs are treated as paid in cash; if you roll them into the new loan, add them to the balance and set closing costs to 0. This is an estimate for planning, not financial advice; your lender's Loan Estimate and the terms of your note are what count.
How to use
Enter your current balance, rate and years left, the new rate and term, and the closing costs, then choose what to show. The default $250,000 at 7% with 25 years left costs $1,766.95 a month; at 6% over the same 25 years it is $1,610.75, a saving of $156.19 a month. $5,000 of closing costs is recovered in about 32 months, and over the full 25 years you save about $41,860 after those costs.
Frequently asked questions
How do I know if refinancing is worth it?
Divide the closing costs by the monthly savings to get the break-even month. If you will keep the loan well past that point, and the total-savings figure is positive, the refinance pays off. If you may move before break-even, it probably does not.
Why can a refinance with a lower payment cost more overall?
Restarting a 30-year term on a loan with 20 years left spreads the balance over 10 extra years. The monthly payment drops, but you pay interest for longer. Compare the total-savings figure, or keep the new term close to the years you have left.
Should I roll closing costs into the loan?
Rolling them in avoids paying cash but adds them to the balance, so you pay interest on them. To model it, add the costs to the current balance and enter 0 for closing costs.
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