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Mortgage Refinance Calculator – Savings

Quick answer

Refi math in one screen: 450,000 going 6.8%→5.9% saves ≈332/month; with 9,000 closing costs you break even at month 27.

  • Run your numbers.

Figures are estimates from this calculator’s standard formula — adjust the inputs in the tool below for your exact number.

How Does the Mortgage Refinance Calculator Work?

Monthly saving = old payment − new payment | Break-even = closing costs ÷ monthly saving

Refinancing trades fees today for lower payments tomorrow, and the deal stands or falls on the break-even month. The calculator prices your current loan with the annuity formula, prices the replacement the same way, and divides total closing costs by the monthly difference. Example: 450,000 with 28 years left at 6.8% costs ≈3,000 per month; refinancing the balance into a fresh 30-year at 5.9% costs ≈2,668 — saving 332 monthly. With 9,000 of appraisal, title and origination fees, break-even lands at 9,000 ÷ 332 ≈ 27 months, so staying 4+ years makes the move worth roughly 7,100 of net savings per additional year. Shortening to 25 years instead lifts the payment to ≈2,891 but saves about 95,000 of lifetime interest — a different goal requiring a different comparison.

  1. 1

    Step 1

    Enter remaining balance, current rate and remaining term.

  2. 2

    Step 2

    Enter the new rate, new term and estimated closing costs.

  3. 3

    Step 3

    Read monthly saving and lifetime interest for both loans.

  4. 4

    Step 4

    Check the break-even month against how long you will stay.

Use Cases

Rate-drop window

Acting when markets drop 0.5–1% below your current rate

ARM rescue

Escaping an adjustable rate before the reset climbs

Term shortening

Using a refi to jump from 30 to 20 years profitably

Cash-out weighing

Pricing the cost of pulling equity for renovations

Common Mistakes

  • Ignoring the break-even

  • Resetting to 30 years

  • Forgetting escrow changes

FAQs

When does refinancing pay off?

When the monthly saving outlives the break-even: cutting 6.8% to 5.9% on 450,000 saves ≈332/month, and 9,000 of fees recover in ≈27 months — worth it only if you stay longer.

How much lower should my rate be to refinance?

The classic threshold is 0.5–1% on a similar term. On 450,000, each 0.5% saves roughly 180–300 per month depending on remaining years.

Is a no-closing-cost refinance free?

No — lenders fold the costs into a higher rate (often +0.25%), so you pay monthly instead of upfront. It suits short stays; cash-at-closing suits long ones.

Should I refinance into a shorter term?

If affordable: at 5.9%, 25 years on 450,000 costs ≈2,891/month versus 2,668 for 30 — 223 more monthly saves ≈95,000 of lifetime interest.

What are typical refinance closing costs?

2–6% of the loan: 9,000–27,000 on 450,000, covering appraisal, origination, title insurance and recording; shopping title insurers alone can cut 500–1,500.

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