Refinance Calculator

Break-even is the real test

Refinancing costs money — lender fees, title, appraisal and recording. Divide those closing costs by your monthly savings and you get the number of months required to break even. Stay past that point and the refinance pays off. Sell or refinance again before it, and you lost money regardless of how much better the new rate looked. If you might move within a couple of years, be skeptical of a marginal rate improvement.

The 30-year reset trap

Refinancing a loan you have already paid into for six years back to a fresh thirty-year term lowers the payment partly because you stretched the remaining balance over a longer period. The calculator shows lifetime interest on both loans so you can see when a lower payment actually costs more overall. If you can absorb the payment, compare a shorter term — the rate is often better and the interest savings can be dramatic.

Rolling costs in is not free

Financing your closing costs eliminates the check at closing, but it raises your balance and you pay interest on those costs for the life of the loan. It can still be the right call for cash flow. Toggle the option and watch the payment and lifetime interest move.

Common questions

How much does a rate need to drop to be worth refinancing?

There is no universal threshold. What matters is whether you will stay past the break-even point. On a large balance, even a modest drop can break even quickly.

Should I roll closing costs into the loan?

It preserves cash but increases the balance and total interest. The calculator shows both scenarios.

Does refinancing restart my loan?

Yes, unless you choose a shorter term. That reset is why a lower monthly payment can still mean more interest overall.

More calculators

• Mortgage Payment (PITI) — See your true monthly payment, not just principal and interest
• Rate Buydown & Points — Permanent points and 1-0, 1-1, 2-1, 3-2-1 temporary buydowns
• Affordability & DTI — What price you qualify for, and what you should actually spend
• Rent vs. Buy — Break-even year and net position over time
• Seller Net Sheet — What you actually walk away with after costs and payoff
• Investment Property ROI — Cash flow, cap rate, DSCR and total return with leverage

Want these numbers run on a real address? Schedule your strategy call →

Educational estimate only — not a loan approval, appraisal, or tax advice. Michael Rush is a licensed REALTOR® with Keller Williams Realty DTC, not a lender, CPA, or attorney. Equal Housing Opportunity.