Free Mortgage Refinance Calculator
Determine if refinancing your mortgage could save you money. Compare your current loan with potential new loan terms.
How to Use This Calculator:
- Enter details about your current mortgage (balance, interest rate, term, and monthly payment)
- Enter details about the new loan you're considering (interest rate and term)
- Include any closing costs and specify whether you'll pay them upfront or roll them into the loan
- Click "Calculate Refinance Savings"
- Review the detailed comparison and savings analysis
- Use the print or copy options to save your results
When Does Refinancing Make Sense?
Interest Rate Reduction
Refinancing typically makes sense when you can secure a rate at least 0.75-1% lower than your current rate. This threshold accounts for closing costs and ensures meaningful savings.
Shortening Loan Term
Moving from a 30-year to a 15-year mortgage often comes with lower rates and builds equity faster, even if monthly payments increase slightly.
Removing PMI
If your home equity has increased above 20%, refinancing can eliminate private mortgage insurance (PMI) payments, reducing your monthly costs.
Cash-Out Refinance
When you need funds for home improvements or debt consolidation, cash-out refinancing may be beneficial if the new rate is favorable.
Mortgage Refinance FAQ
What's the break-even point in refinancing?
The break-even point is when your monthly savings equal the closing costs. For example, if closing costs are $3,000 and you save $100/month, you'll break even in 30 months. Only refinance if you plan to stay in the home beyond this point.
Should I pay closing costs upfront or roll them into the loan?
Paying upfront avoids interest on those costs but requires cash. Rolling them in increases your loan balance but preserves cash flow. Compare both options using this calculator to see which makes more financial sense for your situation.
How much do refinance closing costs typically cost?
Closing costs usually range from 2-5% of the loan amount. For a $200,000 loan, expect $4,000-$10,000 in fees including appraisal, title insurance, origination fees, and prepaids.
Does refinancing reset my loan term?
Yes, refinancing starts a new loan term. If you've paid 5 years on a 30-year mortgage and refinance into another 30-year loan, you'll now have 30 years of payments ahead. Consider shorter terms to maintain your payoff timeline.
How does refinancing affect my taxes?
Mortgage interest remains tax-deductible, but consult a tax professional as refinancing may change your deduction amount. Points paid on a refinance must typically be amortized over the loan's life rather than deducted in one year.
Why Use Our Refinance Calculator?
Make an Informed Refinancing Decision
Our refinance calculator helps you objectively evaluate whether refinancing your mortgage could save you money. By comparing your current loan with potential new terms and accounting for all costs, you can make a financially sound decision about one of the most significant financial transactions homeowners face.