Compare remaining cost of your current loan vs refinancing. Calculate net savings, break-even month, and total cost including closing fees for any loan type.
Refinancing replaces your existing loan with a new one — ideally at a lower interest rate, shorter term, or lower payment. But refinancing is not free. Closing costs, origination fees, and extending your term can eat into savings or even cost you more than keeping the original loan.
The Loan Refinance Savings Calculator compares the remaining cost of your current loan against a new refinanced loan including all fees. It calculates net savings (or cost), the break-even month when savings exceed refinancing costs, and a month-by-month comparison.
This calculator works for any loan type — mortgage, auto, personal, or student. Enter your current loan details, new loan terms, and refinancing costs to get a clear picture of whether refinancing makes financial sense. Many homeowners and borrowers refinance only looking at the new monthly payment, but the real question is whether total lifetime savings exceed the upfront fees. This calculator models that exact tradeoff, including scenarios where you may sell or pay off the loan early.
Lenders pitch refinancing as free money — lower rate, lower payment. But the math is not always that simple. Extending your term can increase total interest even at a lower rate. Closing costs must be recouped before you truly save. If you plan to pay off or sell before the break-even point, refinancing costs you money. This calculator does the complete comparison so you make the right call.
Monthly payment = P × r(1+r)^n / ((1+r)^n − 1). Remaining cost of current loan = current payment × remaining months. Total cost of new loan = new payment × new term months + closing costs. Net savings = remaining cost − new total cost. Break-even month = closing costs / monthly savings.
Result: $26,438 net savings, break-even at month 24
Your current loan has $180,000 remaining at 6.5% with 300 months left ($1,201/month, $360,349 remaining cost). Refinancing to 5.0% for 300 months gives a $1,013/month payment ($303,911 total + $4,500 closing = $308,411). Net savings of $26,438 over the life of the loan. Break-even occurs at month 24 — refinancing costs you money if you sell or payoff before 2 years.
A common pitfall is refinancing into a new 30-year mortgage when you only had 22 years left. Even with a lower rate, restarting the clock can cost tens of thousands in additional interest. Always compare total remaining cost, not just monthly payment. If possible, refinance to the same remaining term or shorter.
The break-even month is the most important number in refinancing. If you plan to sell your home in 3 years and break-even is at 4 years, refinancing loses money. Calculate break-even precisely: closing costs divided by monthly savings. Add a safety margin — life circumstances change.
Some lenders offer lower rates with higher closing costs, while others offer a no-cost refinance with a slightly higher rate. A no-cost refi has an immediate break-even (month 1) but costs more per month forever. A low-rate/high-cost refi takes longer to break even but saves more long-term. Choose based on your time horizon.
Cash-out refinancing lets you borrow more than your current balance and pocket the difference. This adds to your loan balance and total interest. Only consider cash-out if the funds are used for something productive (home improvement, high-interest debt payoff) — not for discretionary spending.
Refinancing is typically worth it when you can lower your rate by at least 0.75%, you plan to keep the loan beyond the break-even point, and closing costs are reasonable (typically 2-5% of the loan). The break-even point is when cumulative monthly savings exceed closing costs.
The break-even point is the month when your cumulative monthly savings from the lower payment equal the upfront closing costs. Before break-even, refinancing has cost you money. After break-even, you are genuinely saving. Calculate it by dividing closing costs by monthly savings.
Extending the term lowers your monthly payment but can increase total interest paid — even at a lower rate. A $200,000 loan at 5% for 30 years costs $186,512 in interest. The same loan for 15 years at 5% costs only $84,685. Refinance to a shorter term if you can afford the payment.
Rolling closing costs into the loan avoids out-of-pocket expense but increases your loan balance and total interest. On a $4,500 closing cost rolled into a 30-year loan at 5%, you pay an extra $4,193 in interest on those costs alone. Pay upfront if possible.
Yes. Auto loan refinancing works the same way — replace your current loan with a new one at a lower rate. Closing costs are typically lower ($0-$100) than mortgage refinancing. It makes sense if your credit has improved since the original loan or if rates have dropped.
There is no legal limit on how often you can refinance. However, each refinance has closing costs that must be recouped. Frequent refinancing (every 1-2 years) rarely makes financial sense. Some lenders have waiting periods or seasoning requirements.