Refinance Calculator See if refinancing saves you money — with break-even analysis, interest savings, and cash-out option...
Refinance Calculator
See if refinancing saves you money — with break-even analysis, interest savings, and cash-out options.
Standard
Term Adjust
Cash-Out
$0
Monthly Savings
0.0 yrs
Break-Even Point
$0
Interest Saved
$0
Total Cost
Savings Timeline: Monthly Savings vs. Closing Costs
When to Refinance
✅ Good candidates for refinancing**:
- Rate drop ≥1%** — e.g., 7.5% → 5.8% = **$175/mo savings** on $280K
- Break-even <3 years** — Closing costs / monthly savings
- Shorten term** — 30-yr → 15-yr to save >50% interest
- Cash-out at lower rate** — $50K @ 5.8% vs. credit cards @ 24%
⚠️ Avoid if**:
- You’ll sell or move before break-even
- Extending term resets the clock (e.g., 5 yrs left → new 30-yr)
- Closing costs >6 months of savings
Red Flags & Risks
⚠️ Watch for these costly mistakes:
- Resetting the amortization clock** — Going from Year 10 to new 30-yr adds $150K+ interest vs. staying on track.
- Cash-out debt recycling** — Using equity to pay credit cards, then racking up cards again.
- Points overpay** — 1 point = 1% fee for 0.25% rate drop → only worth it if staying 4+ years.
- “No-cost” refi traps** — Lender rolls fees into loan or hikes rate 0.3–0.5%.
✅ Pro Tip**:
- Get 3+ quotes — fees and rates vary wildly by lender
- Ask for “lender credits” to offset closing costs
- Lock rate for 45–60 days (not 30) to avoid rush
2025 Refinance Benchmarks
| Current Rate | New Rate | Loan | Savings |
|---|---|---|---|
| 7.5% | 5.8% | $280K, 25 yrs | $175/mo, $52,500 interest saved |
| 6.8% | 5.5% | $320K, 28 yrs | $204/mo, $61,200 interest saved |
| 7.2% | 5.0% | $250K, 10 yrs left | $298/mo, $35,800 interest saved (15-yr refi) |
📉 Break-Even Formula**:
$$\text{Break-Even (months)} = \frac{\text{Closing Costs}}{\text{Monthly Savings}}$$
Example: $4,500 closing / $175/mo = **25.7 months** (2.1 years)
✅ Rule of Thumb**:
- Break-even ≤ 2 yrs → GO
- 2–4 yrs → Wait & monitor rates
- ≥ 4 yrs → NO — not worth it
How to Use This Calculator
➡️ Standard Refinance
Lower your rate without changing term — see monthly savings and break-even.
➡️ Term Adjustment
Shorten (save interest) or extend (lower payment) your loan.
➡️ Cash-Out
Model tapping equity — see new LTV, payment, and net benefit vs. other debt.
You’ll get:
- Monthly payment change
- Break-even timeline
- Total interest saved (or added)
- Visual savings curve
Note: Assumes fixed rates, no prepayment penalties, and on-time payments.