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Refinance Calculator

Compare your current loan with a refinance: new payment, APR, monthly and lifetime savings, closing costs, cash-out, and the break-even month.

I know my remaining balance

ExampleSample values — edit any field to see your result.

$
$
%
years
%

Discount / mortgage points paid upfront. One point is 1% of the new loan amount.

$

Application, origination, appraisal, document, and other closing costs paid upfront.

$

Cash to take out on top of the remaining balance. Use a negative number to put extra cash in and shrink the new principal.

Results update as you type.

New Monthly Payment

$1,791.08

Estimated result

The APR for the new loan is 6.329%, which is 0.671% lower than the 7% interest rate of the current loan. Refinancing would be financially less expensive. $8.92/month savings in monthly pay. 45 months faster the loan will be paid off. $76,641.36 lifetime savings for the new loan. $6,500.00 upfront cost. Break even point: 30 months.

New Loan APR
6.329%
Monthly Savings
$8.92
Months Faster
45
Lifetime Savings
$76,641.36
Upfront Cost (points + fees)
$6,500.00
Break-even
30months
Current remaining term
285months
Total interest (current)
$263,000.00
Total interest (new)
$179,858.64

Current vs new loan

Current loan (remaining)New loanDifference
Principal/loan amount$250,000.00$250,000.00$0.00
Monthly pay$1,800.00$1,791.08-$8.92
Length285 months240 months-45 months
Interest rate/APR7%6.329%-0.671%
Total monthly payments$513,000.00$429,858.64-$83,141.36
Total interest$263,000.00$179,858.64-$83,141.36
Cost + points (upfront)$0.00$6,500.00
Time to recover cost/pointNA30 months
New Monthly Payment$1,791.08

Compare your current loan with a refinance. Enter the remaining balance and payment — or the original amount and time left — then a new term, rate, points, fees, and optional cash-out. The result is a side-by-side of payment, length, interest, APR, lifetime savings, and the month you break even on closing costs.

Formula

Monthly compounding uses i = R / 1200. The level payment on principal P over N months is:

payment(P, i, N) = P × i / (1 − (1 + i)^(−N))

Remaining balance known (mode b). Remaining months N = floor(−ln(1 − P×i/A) / ln(1+i)), total remaining payments T = A × N, interest I = T − P.

Original amount known (mode t). Compute the original payment, then the balance after k = Norig − Nrem payments. Remaining totals use T = A × Nrem.

New loan. Pnew = Pcurrent + cashOut, Anew = payment(Pnew, i_new, Nnew), upfront U = costs + (points/100) × Pnew. APR is the annual rate j that satisfies:

Anew = (Pnew − U) × (j/12) / (1 − (1 + j/12)^(−Nnew))

Lifetime savings is current remaining interest minus new interest minus U. Break-even is the first month where cumulative interest savings cover U.

Points and fees are paid upfront — they are not added to the new principal. A cash-out increases the new principal; a negative cash-out (cash-in) reduces it.

What the comparison shows

RowCurrentNew
PrincipalRemaining balanceRemaining + cash-out
Monthly payCurrent paymentAmortized new payment
LengthMonths left on the current loanNew term in months
Interest rate / APRNote rateAPR including points and fees
Total payments / interestOver the remaining current termOver the new term
Upfront$0Costs + points
Break-even—Months until interest savings cover U

Examples

Remaining $250,000 at 7%, payment $1,800, refinance to 20 years at 6%

Two points and $1,500 of fees cost $6,500 upfront. The new payment is $1,791.08 (APR 6.329%), $8.92 less per month, 45 months faster, and $76,641.36 cheaper over the remaining life. Break-even is 30 months.

Original $300,000 30-year at 7%, 20 years left, $20,000 cash-out into 15 years at 5.5%

The remaining balance is about $257,437.15; the new principal is $277,437.15. Payments go from $1,995.91 to $2,266.89 over 240 → 180 months. Take-home after 2 points and $1,500 of fees is about $12,951.

Frequently asked questions

When does refinancing make sense?
When the lifetime interest you would save on the new loan is larger than the upfront cost of points and fees, and you will keep the loan past the break-even month. A lower rate, a shorter remaining term, or both can produce that savings. If you plan to sell or refinance again before break-even, the closing costs usually win.
How is the new monthly payment calculated?
With the standard amortization formula. For a new principal P (remaining balance plus any cash-out), a monthly rate i (the new annual rate divided by 12), and N months in the new term, the payment is P × i ÷ (1 − (1 + i)^−N).
What are points, and how do they affect APR?
One point is 1% of the new loan amount, paid upfront in exchange for a lower note rate. Points and other closing costs are treated as prepaid finance charges: they reduce the amount you actually receive, so the APR is higher than the note rate. This calculator solves for the APR that makes the new payment equal the payment on (principal − costs − points).
How is the break-even point calculated?
It is the first month where the cumulative interest you would have paid on the current loan exceeds the interest on the new loan by at least the upfront cost. That is stricter than dividing closing costs by the monthly payment difference, and it still applies when the new payment is a little higher but the term is shorter.
What is a cash-out refinance?
The new loan is larger than the remaining balance; the difference is paid to you in cash. Points are charged on the full new principal, so take-home is the cash-out minus points and fees. Use a negative cash-out amount for a cash-in refinance that shrinks the new balance.
Why can the remaining term differ from the original schedule?
If you enter the remaining balance and payment, the calculator solves for how many months that payment still has to run: N = floor(−ln(1 − P×i/A) / ln(1+i)). Extra principal payments, rounding, or a recast can make that shorter or longer than the term printed on the original note.

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