Mortgage Refinance Calculator

Compare your current mortgage with a replacement option, including closing costs, cash-out, PMI, and taxes/insurance.

Unsure if now is the right time to refinance your home? Our free mortgage refinance calculator helps you compare your existing mortgage with a proposed replacement option. Enter your home’s value, current interest rate, and new financing terms to estimate monthly savings, determine your break-even point, and see whether the change makes financial sense for you.

Share:

Current Loan

%

New Loan (Refinance)

%
%
%

If both $ and % for closing costs are provided, the dollar amount is used.

Quick Facts (auto)

Current monthly P&I$2,465
Current total monthly (PITI+PMI)$2,935
Remaining term25y 0m
New loan amount$356,728
New monthly P&I$2,136
New PMI (month 1)$0
New total monthly (month 1)$2,606
New LTV79.27%

Results: Estimated monthly savings $328. Total interest saved over loan life: -$29,727. Upfront cash needed: $6,000. Break-even in about 19 months.

Current Loan - Summary

  • Remaining balance$356,728
  • Remaining term25y 0m
  • Monthly P&I$2,465
  • Total monthly (PITI+PMI)$2,935
  • Total interest remaining$382,674

New Loan - Summary

  • Loan amount (incl. financed costs)$356,728
  • Monthly P&I$2,136
  • PMI (month 1)$0
  • Total monthly (month 1)$2,606
  • Closing costs (est.)$6,000
  • Upfront cash needed$6,000
  • Total interest (new loan)$412,401

Home Equity Over Time

PMI shown above is month-1 only; on the new loan it ends once your balance reaches ≤ 80% of home value. Taxes/insurance are kept the same for both scenarios to isolate the refinance effect.

Methodology & Notes
  • P&I uses the standard amortization formula. Remaining balance is either your entry or computed from original loan, rate, and time paid.
  • Closing costs can be entered as a dollar amount or % of the new base (remaining balance + cash-out). Dollar amount takes precedence if both are set.
  • If you “finance” closing costs, they are added to the new principal instead of paid upfront.
  • New PMI is included when LTV > 80% and ends when balance ≤ 80% of the current home value (no appreciation modeled here).
  • Break-even ≈ closing costs ÷ monthly savings (month-1 totals). Real outcomes vary with taxes, escrow changes, and rate resets.

Educational estimates only. For advice tailored to your situation, consult your lender or financial advisor.

See If You Can Save by Refinancing Your Mortgage

Now that you’ve compared your current mortgage with a refinance scenario, take the next step. Explore real options based on your numbers and see how much you could save on your monthly costs or total interest.

What is a mortgage refinance?

A refinance replaces your existing mortgage with a new mortgage, often to lower the rate, change the term, or access equity. The calculator above compares your current balance and terms with a proposed replacement scenario and shows month-one savings, total interest savings, break-even timing, and equity over time.

How refinancing works

  1. We estimate your remaining balance and monthly amount on the current mortgage using standard amortization.
  2. We build a replacement scenario from your inputs, including rate, term, cash-out, and whether closing costs are paid now or rolled in.
  3. We compare total monthly costs, including P&I, estimated escrow, and PMI when applicable.
  4. Break-even = closing costs divided by month-one savings. Total interest saved compares the rest of your existing mortgage versus the replacement option.

Key refinancing factors

Your interest rate

Even a small rate drop can reduce interest meaningfully, especially early in the term.

Closing costs

Typically 2-5% of the amount financed. You can pay them at closing or roll them into the new principal.

Credit score & LTV

Better credit and a lower loan-to-value (LTV) often qualify for better pricing and can avoid PMI.

Term selection

Shorter terms increase the payment but lower total interest. Longer terms do the opposite.

Common refinance types

  • Rate-and-term: Change your rate and/or length with no cash back.
  • Cash-out: Borrow more than the current balance to access equity.
  • Streamline (FHA/VA): Simplified documentation for eligible borrowers; terms vary by program.

When to refinance

  • You can lower your rate enough to break even before you sell or move.
  • You want to shorten the term to pay off faster and build equity.
  • You need cash for renovations or debt consolidation (cash-out).
  • Your adjustable-rate mortgage is resetting and you prefer a fixed rate.

The refinancing process

  1. Use the calculator to estimate savings and break-even.
  2. Request quotes and compare written Loan Estimates.
  3. Apply and provide documents (income, assets, insurance).
  4. Appraisal and underwriting (if required).
  5. Receive final terms (Closing Disclosure) and sign at closing.

Refinancing FAQs

How accurate is the calculator?

It uses standard amortization and plain assumptions for PMI and escrow items. Use it to compare scenarios, then confirm with a lender's Loan Estimate.

What are typical closing costs?

Often 2-5% of the amount financed. State taxes and lender fees vary. You can enter a dollar amount or a percentage and choose to pay now or roll them into the new balance.

Will refinancing affect my credit score?

A hard inquiry may cause a small, temporary dip. Rate-shopping within a short window is usually counted as one inquiry by major scoring models.

When does PMI apply?

PMI is generally required when LTV > 80%. In this tool, PMI ends once the balance falls to 80% of home value. Program rules can differ.

How do you calculate break-even?

Break-even = closing costs divided by month-one payment savings. If savings are $0, there is no break-even for those inputs.

Is a shorter term always better?

It cuts total interest but raises the payment. Choose a term that balances savings and cash-flow.