The Calculator App
Mortgage Refinance Calculator
Compare keeping a current mortgage with a new fixed-rate loan. This is a planning tool, not a lender quote or an approval.
$235.01 lower / month
Illustrative comparison using a $320,000 balance, a 7.25% current rate, and a 6.48% new rate. Current principal and interest $2,253.42. New principal and interest $2,018.41. Not a quote. The interactive calculator replaces this summary in the browser.
What refinancing means
This calculator compares keeping your current loan with a new fixed-rate loan. Principal and interest come from the same mortgage engine as the mortgage calculator. Taxes, insurance, HOA, and other housing costs are applied to both paths so they do not create a false difference.
Costs, credits, and cash-out
Closing costs can be paid in cash or added to the new loan. Adding them raises the balance and the payment, so they are not free. Lender credits reduce cash due. They are not subtracted from principal. Cash-out proceeds are shown separately from monthly savings.
Questions
What does refinancing mean?
Refinancing replaces the loan you have with a new loan. The new loan pays off the current balance. You then pay the new loan under the rate, term, and costs you enter here.
When can refinancing help?
A lower rate or a shorter term can reduce interest. A longer term can lower the monthly payment and still increase total interest. This page compares those outcomes. It does not know whether a lender will approve the new loan.
How does break-even work?
Simple break-even divides unrecovered cash financing charges by the monthly housing-payment reduction. Economic break-even compares principal, interest, mortgage insurance, and the remaining balance on each loan. It includes financed fees, cash-out, and cash applied to principal. Property taxes, homeowners insurance, and HOA dues are left out of that difference because both choices still pay them. Escrow deposits are cash at closing, not a permanent loss. An expected escrow refund is counted only after its assumed month, and it is not subtracted from the cash you need at closing.
What is the difference between cash-out and a rate-and-term refinance?
A rate-and-term refinance replaces the balance and the terms. Cash-out increases the new loan and gives you the extra money. That money is not a saving. Cash you pay in reduces the new loan and is money you bring, not a lender credit.
Why is a lower payment not the same as savings?
Extending the term spreads the balance over more months, so the payment can fall while interest rises. The horizon table uses the same starting date for both loans and stops a loan’s payments when that loan is paid off.
Open the mortgage calculator for the new loan’s schedule, or estimate a purchase budget if you are buying rather than refinancing.