Enter your current loan details and a proposed new rate to see your break-even point, monthly savings, and total cost comparison over the life of both loans.
$
3 years & 0 months
Estimated balance: $308,535
Remaining term: 324 months (27.0 years)
%
324 months
$
Carried forward to new loan
Current P&I Payment
$2,023/mo
%
$
$7,713 (estimated)
$
$
$
Roll costs into loan?
Adds closing costs to new balance
Total Refinance Cost
$9,213
If you plan to stay less than 35 months, refinancing may cost more than it saves. After that, you save $15,457 total.
This is an estimate, not financial advice.
New Payment
$1,752
Save $271/mo
Break-Even
35 mo
2.9 years
Interest Saved
$24,670
Less interest paid
Current Total Cost
$655,328
Remaining on current loan
New Total Cost
$639,871
Including closing costs
Payoff Timeline
30 yrvs 27 yr
3 years longer
Break-Even Analysis
Current mortgage cumulative cost Refinance cumulative cost (incl. closing)
Rate Sensitivity — At What Rate Does Refinancing Make Sense?
New Rate
Monthly Savings
Break-Even
5yr Savings
10yr Savings
Lifetime Savings
6.50%
+$72
128 mo
-$4,865
-$517
-$55,940
6.25%
+$123
75 mo
-$1,838
+$5,537
-$37,778
6.00%
+$173
54 mo
+$1,155
+$11,522
-$19,822
5.75%
+$222
42 mo
+$4,112
+$17,438
-$2,075
5.50%YOUR RATE
+$271
35 mo
+$7,034
+$23,282
+$15,457
5.25%
+$319
29 mo
+$9,920
+$29,052
+$32,768
5.00%
+$366
26 mo
+$12,767
+$34,747
+$49,853
4.75%
+$413
23 mo
+$15,576
+$40,365
+$66,708
4.50%
+$459
21 mo
+$18,346
+$45,905
+$83,326
4.25%
+$505
19 mo
+$21,076
+$51,364
+$99,704
4.00%
+$550
17 mo
+$23,764
+$56,742
+$115,837
3.75%
+$594
16 mo
+$26,412
+$62,036
+$131,720
3.50%
+$637
15 mo
+$29,016
+$67,246
+$147,349
Highlighted: your entered rate Green tint: break-even under 5 years
Want the full affordability picture?
Tax benefits, buy vs rent comparison, net worth projection, and more.
The classic rule — "refinance when rates drop 1%" — is a starting point, not a decision. The real question is whether your monthly savings will repay the closing costs before you move or sell. That break-even point is what the calculator above computes precisely.
Beyond the break-even, consider your loan term. Refinancing into a new 30-year loan resets the amortization clock — you may lower your payment but extend your payoff date and increase total interest paid. Refinancing into a 15-year accelerates payoff dramatically but raises monthly obligations. Neither is universally better; it depends on your goals.
2–5%
Typical closing costs
Of loan amount
18–36 mo
Average break-even
Varies by rate drop
~0.6%
15-yr rate advantage
Below 30-yr rate
⏱️
Break-Even by Rate Drop — Quick Reference
How long to recoup $6,000 in closing costs on a $300,000 loan, depending on your rate reduction:
Rate Drop
Monthly Savings
Break-Even
10-Yr Savings
0.25%
~$47
~128 mo (10.7 yr)
~$3,600
0.50%
~$94
~64 mo (5.3 yr)
~$5,300
0.75%
~$141
~43 mo (3.6 yr)
~$10,900
1.00%
~$187
~32 mo (2.7 yr)
~$16,400
1.50%
~$278
~22 mo (1.8 yr)
~$27,400
2.00%
~$368
~16 mo (1.4 yr)
~$38,100
$300k loan, 25 yrs remaining, $6k closing costs. Use the calculator for your exact numbers.
🔄
Types of Refinances — Which Is Right for You?
📉Rate-and-Term Refi
Most common
Lower your rate, change your term, or both — without taking cash out. Keeps loan balance about the same. Best when your goal is lower payments or faster payoff.
Ideal when: Rate drop ≥ 0.75% + staying 3+ years
💵Cash-Out Refi
Borrow more than you owe and take the difference as cash. Useful for home improvements, ADU construction, or debt consolidation. Typically requires 20%+ equity remaining.
Ideal when: Strong equity + specific use for funds
🏎️15-Year Refi
Lower rate + faster payoff at the cost of a higher monthly payment. On a $300k loan at current rates, switching 30→15 yr raises payment ~$600/mo but saves ~$180k in interest.
Ideal when: Income stable + 10+ yrs left on mortgage
🔁No-Closing-Cost Refi
Closing costs rolled into loan balance or offset by a slightly higher rate. Upfront cost is zero but you pay more over time. Best if you plan to move or refi again within 3–4 years.
Ideal when: Short remaining time horizon
💳
Refinancing Costs & Credit Score Impact
Understanding every cost line keeps you from being surprised at the closing table.
Cost Item
Typical Range
Loan origination fee
0–1% of loan
Appraisal
$300–$700
Title insurance & search
$500–$2,000
Attorney / settlement fee
$500–$1,500
Prepaid interest
0–30 days
Recording fees
$25–$250
Total (typical)
2–5% of loan
Credit Score & Rate Impact
760+Best rates — within 0.125% of advertised
720–759Very good — typically +0.125–0.25% above best
680–719Good — +0.25–0.5% above best rates
620–679Fair — +0.5–1.5%; may require larger down
Below 620Limited options; FHA streamline may apply
❓
Mortgage Refinancing — Frequently Asked Questions
When does refinancing make financial sense?
Refinancing makes sense when the interest savings over your remaining time in the home exceed the closing costs. The classic rule of thumb is a 1% rate drop, but what really matters is your break-even point: closing costs ÷ monthly savings = months to recoup. If you plan to stay longer than that, refinancing pays. If you're moving in 2 years but break-even is 3 years, skip it.
What is a refinancing break-even point?
The break-even point is how many months it takes for your monthly payment savings to fully repay the closing costs you paid to refinance. For example: $6,000 in closing costs ÷ $200/month savings = 30 months (2.5 years) to break even. After that, every month you stay generates $200 in net savings.
How much does it cost to refinance a mortgage?
Refinancing closing costs typically run 2–5% of the loan amount — commonly $4,000–$12,000 on a $300,000 loan. Major costs include: loan origination fee (0–1%), appraisal ($300–$700), title insurance ($500–$2,000), attorney/settlement fees ($500–$1,500), and prepaid interest. Some lenders offer "no-closing-cost" refinances that roll these costs into a slightly higher rate.
What is a no-closing-cost refinance?
A no-closing-cost refinance lets you avoid paying closing costs upfront by either rolling them into the loan balance or accepting a slightly higher interest rate (lender credits). This reduces your upfront cost to zero but increases your monthly payment or total interest paid. It's best for borrowers who plan to move or refinance again within 3–5 years and don't want to recover closing costs.
Should I refinance to a 15-year mortgage?
A 15-year refinance offers a lower interest rate (typically 0.5–0.75% below a 30-year) and cuts total interest paid roughly in half — but increases your monthly payment significantly. On a $300,000 loan, switching from a 30-year at 7% to a 15-year at 6.25% raises your monthly payment by about $600 but saves roughly $180,000 in total interest. It's ideal for borrowers who can comfortably absorb the higher payment.
What credit score do I need to refinance?
For conventional refinances, most lenders require a minimum 620 credit score, but the best rates (within 0.25% of advertised rates) typically require 740+. FHA streamline refinances can allow scores as low as 580. A score below 680 will add meaningful cost through higher rates or points — often negating the benefit of refinancing unless your rate drop is substantial.
Can I take cash out when I refinance?
Yes — a cash-out refinance lets you borrow more than your current loan balance and take the difference as cash. Most lenders allow up to 80% LTV (loan-to-value ratio), meaning you need at least 20% equity after the cash-out. Cash-out refis carry slightly higher rates than rate-and-term refis (typically 0.125–0.5% higher) and reset your loan term, increasing long-term interest costs.