Compare keeping an existing fixed-rate loan with refinancing, including payment changes, interest, closing costs, cash out, payoff dates, and estimated break-even timing.
Refinancing replaces an existing loan with a new loan. People may refinance to change the interest rate, monthly payment, repayment term, or amount borrowed, but the new loan can introduce closing costs and restart the repayment timeline.
This calculator compares modeled cash flows rather than recommending a decision. Actual offers, fees, escrow changes, taxes, prepayment terms, and lender calculations may differ.
P is financed principal, r is the monthly rate, and n is the number of payments. At 0% interest, payment is principal ÷ months.
P × r × (1 + r)ⁿ ÷ ((1 + r)ⁿ − 1)A positive result is a payment decrease; a negative result is a payment increase.
Current required payment − new required paymentFinanced closing costs are already included in refinance principal and payments.
Remaining current-loan payments − refinance payments − upfront refinance costsWith 25 years remaining, the estimated current payment is $1,766.95 and remaining interest is $280,084.40. A new 25-year loan at 6% is about $1,610.75 with $233,226.05 in interest. With $5,000 paid upfront and no cash out, estimated payment savings are $156.19 per month and cumulative cash flow reaches break-even in month 33.
A longer new term can lower the required payment while increasing how long interest is paid.
Upfront closing costs are immediate cash outflow. Financed costs increase principal and accrue interest.
A modeled break-even point matters only if the loan remains in place long enough for cumulative savings to recover costs.
Break-even is the first modeled payment month when cumulative refinance cash outflow is no greater than cumulative cost of keeping the current loan. The comparison includes upfront closing costs when applicable and financed costs through the refinance payments.
If the refinance never becomes less costly within the modeled schedules, the calculator reports no break-even rather than inventing a date.
A lower rate can reduce interest, but extending the repayment term may lower the payment partly because repayment lasts longer. Review payment, interest, total cost, and payoff date together.
Cash out increases the new financed principal and gives the borrower additional funds. Those proceeds are not counted as cost savings, and the comparison is less direct because the loan amounts differ.
An entered extra amount is applied to refinance principal after the scheduled payment. It does not change the required payment, but it may shorten payoff and reduce refinance interest.
It is the first modeled month when cumulative refinance cash outflow is no greater than cumulative cost of keeping the current loan.
Yes. When financed is selected, closing costs are added to the new principal and repaid with interest.
Yes. Extending the term or financing costs can lower the payment while increasing total lifetime cost.
If entered and mathematically valid, it is used for the current-loan schedule and comparison without being replaced by the calculated payment.
Cash out is added to new principal. It is additional borrowed money and is not labeled as refinance savings.
No. They are modeled as additional principal payments and can change payoff time and interest.
Refinance cash flows may never become lower before the modeled loans are repaid, particularly with higher payments or costs.
No. It compares principal-and-interest loan cash flows and entered closing costs, not changing taxes, insurance, or escrow.