Free tool
Mortgage refinance calculator
Compare the current mortgage with a refinance: the monthly saving, how many months until the closing costs are paid back, and the total interest and total cost difference, with the effect of restarting the loan term shown plainly. Print or save it as a client handout. An estimate, not a loan offer. Everything stays in your browser — nothing you type is sent or stored.
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How the comparison is worked out
The current loan is paid down month by month at its rate until it is gone, using the payment you enter or the one calculated from the balance, rate and months remaining. The new loan is the same balance (plus the closing costs if they are rolled in) at the new rate and term. The monthly saving is the difference between the two payments. The simple break-even is the closing costs paid up front divided by that saving.
The second break-even is the first month when everything paid on the refinance path so far, plus the balance still owed, is no more than the same total on the current path. It counts closing costs, interest and the speed the balance falls, so it is the fairer test when the term changes.
Assumptions to say out loud
- Principal and interest only: tax, insurance, HOA and mortgage insurance are left out.
- Term reset: a longer new term lowers the payment by spreading the debt out; compare the total interest, not only the payment.
- Fixed rates: both loans are assumed fixed for their full life.
- Not included: cash out, points paid outside the closing costs entered, taxes, and what any monthly saving could earn.
Using it with clients
- Run it with the lender’s quoted rate and costs, then with a new term equal to the remaining term.
- Show the break-even and ask honestly whether the client expects to stay in the home that long.
- If the term is reset, point to the total interest line: a lower payment is not always a lower cost.
Related: the mortgage payment calculator, the home equity calculator and the rest of the free tools for real estate agents.
Related tools for buyers and sellers: seller net sheet calculator, home affordability calculator and rent vs buy calculator.
Guide: How to explain home equity and refinance break-even to past clients.
See how extra payments change a loan with the mortgage amortization calculator.
Common questions
What is the refinance break-even point?
The number of months it takes for the monthly saving to pay back the closing costs. Divide the closing costs paid up front by the monthly payment saving. If the closing costs are $4,500 and the payment falls by $150 a month, the break-even is 30 months. This is a payment-saving rule only: it ignores the remaining loan balance and a changed term. Use the balance-inclusive comparison below when judging the full cost.
Why does the calculator show a second break-even?
The simple rule ignores the loan balance. The second figure compares total paid so far plus what is still owed on each path, so it also captures how much faster or slower the balance falls. It can be earlier or later than the simple figure, particularly when the new term is longer.
What is the term reset problem?
If 22 years remain on the current loan and the new loan is a fresh 30 years, the payment can fall mostly because the debt is stretched, not because the rate is better. That can raise total interest even with a lower rate. The sheet shows the new payment on the current remaining term as a like-for-like check, and the total interest and total cost for both paths.
What if I roll the closing costs into the loan?
Choose that option and the new loan is the old balance plus the closing costs. Nothing is paid up front, but the payment is a little higher and interest is charged on the costs. The break-even then uses the balance-inclusive comparison, because the simple payment-saving rule hides the extra borrowing.
What is not included?
Escrow items (tax and insurance), mortgage insurance changes, points paid separately from the closing costs entered, cash out, tax effects, rate locks and what the freed-up money would earn. The result is an estimate from your numbers, not a loan offer.
Can a refinance make sense with no monthly saving?
Sometimes: a shorter term at a lower rate can raise the payment but cut total interest a lot, or a refinance can remove mortgage insurance. The break-even then reads as no payment saving, and the total cost difference shows whether the refinance still saves money overall.
Does the calculator save what I enter?
No. Balances, rates, names and contact details stay in your browser and are not sent to Kadapt, stored, or used in analytics. The only thing counted is that someone pressed the print, PNG or copy button, never what was on the sheet.
Is this a loan offer?
No. It is an estimate based on the figures you enter. A lender's quote, fees and approval decide the real numbers. It is not financial, tax or legal advice.