★ MONEY · MORTGAGE REFINANCE CALCULATOR · SAVINGS & BREAK-EVEN
New payment $1,798.65/mo a month, saving $418.32/mo a month — break-even in 14.34 months, total saving $11,577.49. Put in the balance, your current rate and remaining term, the new rate and term, and the closing costs, and the calculator works out the new payment, the monthly saving, the break-even month and the total saving — with the closing costs paid up front.
A refinance swaps your current mortgage for a new one on the same balance, usually at a lower rate or a different term. This calculator works out whether the swap pays off: the new payment, the monthly saving, the month the saving covers the closing costs, and the total saving over the life of the new loan.
On the defaults — a $300,000.00 balance at 7.50% with 25.0 years left, refinanced into 6.00% over 30.0 years with $6,000.00 of closing costs — the current payment is $2,216.97/mo a month and the new payment is $1,798.65/mo a month, so the monthly saving is $418.32/mo. The saving covers the closing costs after 14.34 months (month 15). Over the full life of the loans the total current cost is $665,092.06 (interest $365,092.06) against a total new cost of $653,514.57 (interest $347,514.57), for a total saving of $11,577.49.
Three things about the model are worth stating plainly. First, the closing costs are paid up front — they are not rolled into the new loan, so the new loan is taken out on the same balance as the old one. Second, the payments are principal and interest only — taxes, insurance and PMI are not included, because they do not change with the refinance. Third, the comparison assumes you stay in the home for the full new term, so the total saving is the saving over the whole life of the new loan, not just the first few years.
And the number that catches people out: a longer new term can make the monthly saving positive while the total saving is negative. Stretching the loan lowers the monthly payment — but it adds years of interest, and those extra years can cost more than the monthly saving ever gives back. That is why this page always shows both numbers side by side: the monthly saving and the total saving. A negative monthly saving or a negative total saving is a valid result, shown as it is — it is the calculator telling you the refinance loses money, not an error.
Setup: balance $300,000.00, current rate 7.50%, remaining term 25.0 years, new rate 6.00%, new term 30.0 years, closing costs $6,000.00.
Line 1 — the monthly rates. Each loan’s monthly rate is its APR divided by one hundred and then by twelve: r = APR ÷ 100 ÷ 12. The current loan and the new loan each get their own monthly rate.
Line 2 — the current payment. The balance amortized at the current monthly rate over the remaining term gives a current payment of $2,216.97/mo a month.
Line 3 — the new payment. The same balance amortized at the new monthly rate over the new term gives a new payment of $1,798.65/mo a month.
Line 4 — the monthly saving. Current payment minus new payment: the saving is $418.32/mo a month.
Line 5 — the break-even. Closing costs divided by the monthly saving: the saving covers the closing costs after 14.34 months (month 15).
Line 6 — the totals. Total current cost $665,092.06 (interest $365,092.06); total new cost $653,514.57 (interest $347,514.57), closing costs included; total saving $11,577.49. Rounding convention: totals are computed from unrounded payment figures, so rounded parts may differ by a cent from their rounded sum.
Balance $200,000: current $1,477.98/mo, new $1,199.10/mo, saving $278.88/mo a month, break-even 21.51 months, total saving $5,718.33. A smaller balance means a smaller monthly saving, but the refinance still pays off overall.
Balance $500,000: current $3,694.96/mo, new $2,997.75/mo, saving $697.20/mo a month, break-even 8.61 months, total saving $23,295.82. The saving scales with the balance — a bigger loan makes the same rate cut worth more in dollars.
Current rate 6.5%: current $2,025.62/mo, new $1,798.65/mo, saving $226.97/mo a month, break-even 26.44 months — but the total saving is -$45,828.12, a total LOSS. The rate cut is too small and the longer new term adds too much interest: the monthly saving is positive, the total saving is negative. Say it plainly — this refinance loses money overall.
Current rate 8.5%: current $2,415.68/mo, new $1,798.65/mo, saving $617.03/mo a month, break-even 9.72 months, total saving $71,189.81. A bigger rate cut turns the same refinance into a clear win.
New rate 5.0%: current $2,216.97/mo, new $1,610.46/mo, saving $606.51/mo a month, break-even 9.89 months, total saving $79,324.71. Dropping the new rate further is the single biggest lever on the saving.
New rate 7.0%: current $2,216.97/mo, new $1,995.91/mo, saving $221.07/mo a month, break-even 27.14 months — but the total saving is -$59,434.63, a total LOSS. Half a point of rate cut is not enough to beat the extra years of interest on the longer new term: the monthly saving is positive, the total saving is negative.
New term 15 years: the monthly saving is -$314.60/mo — the payment goes UP, not down, because the same balance is cleared in far fewer years — but the total saving is $203,409.37. Both figures together, never one without the other: a higher payment that saves a fortune overall. If the monthly budget can take the higher payment, this is the version that builds wealth fastest.
New term 20 years: current $2,216.97/mo, new $2,149.29/mo, saving $67.68/mo a month, break-even 88.65 months, total saving $143,261.70. A shorter term still saves each month and saves far more in total than the default term.
Closing costs $3,000: current $2,216.97/mo, new $1,798.65/mo, saving $418.32/mo a month, break-even 7.17 months, total saving $14,577.49. Halving the closing costs nearly halves the break-even and lifts the total saving by the same amount.
Closing costs $12,000: current $2,216.97/mo, new $1,798.65/mo, saving $418.32/mo a month, break-even 28.69 months, total saving $5,577.49. Doubling the closing costs stretches the break-even and eats the same amount out of the total saving.
Remaining term 20 years: current $2,416.78/mo, new $1,798.65/mo, saving $618.13/mo a month, break-even 9.71 months — but the total saving is -$73,487.47, a total LOSS. The monthly saving is big, because the current loan is nearly paid off and its payment is high — but the current loan would have been finished in twenty years, while the new loan runs on for thirty. A big monthly saving, and a big total loss. Say it plainly — this refinance loses money overall.
New rate for a $500 monthly saving: 5.57% — the exact rate is 5.5722%. At 5.57% the monthly saving is $500.41/mo; at 5.56% it is $502.30/mo. The star is a PERCENT.
Closing costs for a 12-month break-even: $5,019.86 — the exact figure is $5019.8635. At $5,019.86 the break-even is 12.00 months; one cent less ($5,019.85) rounds to the same 12.00 — this reverse is exact, not a step. The star is DOLLARS.
Balance for a $0 total saving: $102,403.68 — the exact balance is $102403.6827. At $102,403.68 the total saving is $0.00; below this balance the refinance loses money overall; one cent less rounds to the same $0.00 — exact, not a step. The star is DOLLARS.
Closing costs for a $0 total saving: $17,577.49 — the exact figure is $17577.4929. At $17,577.49 the total saving is $0.00; one cent more, $17,577.50, the total saving is -$0.01. The star is DOLLARS.
New rate for a $0 monthly saving: 8.08% — the exact rate is 8.0749%. At 8.07% you still save $1.02/mo a month; at 8.08% the monthly saving is -$1.07/mo. The star is a PERCENT.
Balance for a $300 monthly saving: $215,145.29 — the exact balance is $215145.2925. At $215,145.29 the monthly saving is $300.00/mo; one cent less rounds to the same $300.00/mo — exact, not a step. The star is DOLLARS.
The closing costs are paid up front and never added to the balance; the new loan is on the same balance as the old one; the payments are principal and interest only, with no taxes, insurance or PMI; both rates are held fixed for the whole comparison, so the model does not cover adjustable-rate loans; and the comparison assumes you stay in the home for the full new term — selling early changes the answer, because the total saving is counted over the whole term. At the edges the model stays honest: with the new rate equal to the current rate, Current $2,216.97/mo, new $2,097.64/mo, saving $119.33/mo, break-even 50.28 months (month 51), total current $665,092.06, total new $761,151.67, total saving -$96,059.61 — the payment still falls, because the term is stretched, but the total saving is negative. With closing costs of $0, Current $2,216.97/mo, new $1,798.65/mo, saving $418.32/mo, break-even 0.00 months (immediately), total current $665,092.06, total new $647,514.57, total saving $17,577.49 — the break-even is immediate. With a new rate of 8.0%, Current $2,216.97/mo, new $2,201.29/mo, saving $15.68/mo, break-even 382.66 months (month 383), total current $665,092.06, total new $798,465.74, total saving -$133,373.68 — a tiny monthly saving and a large total loss. With a balance of $0, Current $0.00/mo, new $0.00/mo, saving $0.00/mo, no break-even, total current $0.00, total new $6,000.00, total saving -$6,000.00 — all payments are $0.00 and the total saving is the closing costs alone; that is the model at its boundary, not an error. With the new term equal to the remaining term, Current $2,216.97/mo, new $1,932.90/mo, saving $284.07/mo, break-even 21.12 months (month 22), total current $665,092.06, total new $585,871.26, total saving $79,220.80. With only ten years left on the current loan, Current $3,561.05/mo, new $1,798.65/mo, saving $1,762.40/mo, break-even 3.40 months (month 4), total current $427,326.37, total new $653,514.57, total saving -$226,188.20 — a huge monthly saving and a huge total loss, because the current loan would soon have been gone. Rounding convention: totals are computed from unrounded payment figures, so rounded parts may differ by a cent from their rounded sum.
| Output | Formula | What it means |
|---|---|---|
| Current payment | pmt = B · r ÷ (1 − (1 + r)^−n), r = APR ÷ 100 ÷ 12, n = months | $2,216.97/mo. |
| New payment | pmt = B · r ÷ (1 − (1 + r)^−n), r = APR ÷ 100 ÷ 12, n = months | $1,798.65/mo. |
| Monthly saving | current payment − new payment | $418.32/mo. |
| Break-even months | closing costs ÷ monthly saving | 14.34 months. |
| Total current cost | current payment × remaining months | $665,092.06. |
| Total new cost | new payment × new months + closing costs | $653,514.57. |
| Total saving | total current cost − total new cost | $11,577.49. |
| Current total interest | total current cost − balance | $365,092.06. |
| New total interest | total new cost − balance − closing costs | $347,514.57. |
| New rate for a $500 monthly saving | exact 5.5722% | 5.57% → 5.57%. |
| Closing costs for a 12-month break-even | exact $5019.8635 | $5,019.86 → $5,019.86. |
| Balance for a $0 total saving | exact $102403.6827 | $102,403.68 → $102,403.68. |
| Closing costs for a $0 total saving | exact $17577.4929 | $17,577.49 → $17,577.49. |
| New rate for a $0 monthly saving | exact 8.0749% | 8.08% → 8.08%. |
| Balance for a $300 monthly saving | exact $215145.2925 | $215,145.29 → $215,145.29. |
| Balance $200,000 | same model | Current $1,477.98/mo, new $1,199.10/mo, saving $278.88/mo, break-even 21.51 months (month 22), total current $443,394.71, total new $437,676.38, total saving $5,718.33. |
| Balance $500,000 | same model | Current $3,694.96/mo, new $2,997.75/mo, saving $697.20/mo, break-even 8.61 months (month 9), total current $1,108,486.77, total new $1,085,190.95, total saving $23,295.82. |
| Current rate 6.5% | same model | Current $2,025.62/mo, new $1,798.65/mo, saving $226.97/mo, break-even 26.44 months (month 27), total current $607,686.45, total new $653,514.57, total saving -$45,828.12. |
| Current rate 8.5% | same model | Current $2,415.68/mo, new $1,798.65/mo, saving $617.03/mo, break-even 9.72 months (month 10), total current $724,704.38, total new $653,514.57, total saving $71,189.81. |
| New rate 5.0% | same model | Current $2,216.97/mo, new $1,610.46/mo, saving $606.51/mo, break-even 9.89 months (month 10), total current $665,092.06, total new $585,767.35, total saving $79,324.71. |
| New rate 7.0% | same model | Current $2,216.97/mo, new $1,995.91/mo, saving $221.07/mo, break-even 27.14 months (month 28), total current $665,092.06, total new $724,526.69, total saving -$59,434.63. |
| New term 15 years | same model | Current $2,216.97/mo, new $2,531.57/mo, saving -$314.60/mo, no break-even, total current $665,092.06, total new $461,682.69, total saving $203,409.37. |
| New term 20 years | same model | Current $2,216.97/mo, new $2,149.29/mo, saving $67.68/mo, break-even 88.65 months (month 89), total current $665,092.06, total new $521,830.36, total saving $143,261.70. |
| Closing costs $3,000 | same model | Current $2,216.97/mo, new $1,798.65/mo, saving $418.32/mo, break-even 7.17 months (month 8), total current $665,092.06, total new $650,514.57, total saving $14,577.49. |
| Closing costs $12,000 | same model | Current $2,216.97/mo, new $1,798.65/mo, saving $418.32/mo, break-even 28.69 months (month 29), total current $665,092.06, total new $659,514.57, total saving $5,577.49. |
| Remaining term 20 years | same model | Current $2,416.78/mo, new $1,798.65/mo, saving $618.13/mo, break-even 9.71 months (month 10), total current $580,027.10, total new $653,514.57, total saving -$73,487.47. |
The math is first-principles: each payment is the standard amortization formula on the balance at its own monthly rate over its own term, the monthly saving is the difference of the two payments, the break-even is the closing costs divided by the monthly saving, and the totals are built from the unrounded payments — every figure is rounded to cents half-up, and the totals are computed from unrounded payment figures, so rounded parts may differ by a cent from their rounded sum. What the model cannot do is predict YOUR refinance bill: it holds both rates fixed, so it does not cover adjustable-rate loans or a rate that changes after closing; it counts only the closing costs you enter, not appraisal, title, points or lender credits you leave out; it leaves taxes, insurance and PMI out of the payments; it assumes you stay in the home for the full new term and does not model selling early, extra payments, or cash taken out at closing. Use it to judge whether the swap pays off, then read your lender’s loan estimate for the exact fees and rate rules.
Bright Side Kit. "Mortgage Refinance Calculator: Savings & Break-Even 2026" https://brightoolbox.com/mortgage-refinance-calculator/ Accessed October 26, 2026.$418.32/mo a month, $11,577.49 in total. The new payment is $1,798.65/mo a month against a current $2,216.97/mo, the saving covers the $6,000.00 of closing costs after 14.34 months (month 15), and the total saving over the full new term is $11,577.49.
5.57%. The exact rate is 5.5722%. At 5.57% the monthly saving is $500.41/mo; at 5.56% it is $502.30/mo.
$5,019.86. The exact figure is $5019.8635. At $5,019.86 the break-even is 12.00 months; one cent less ($5,019.85) rounds to the same 12.00 months — this reverse is exact, not a step.
$102,403.68. The exact balance is $102403.6827. At $102,403.68 the total saving is $0.00; below this balance the refinance loses money overall.
The payment goes up, but the total saving is $203,409.37. The monthly saving is -$314.60/mo — the new payment is $2,531.57/mo a month against a current $2,216.97/mo — and there is no break-even, because there is no monthly saving to cover the closing costs. The total saving is $203,409.37, because the loan is cleared in far fewer years. Judge it on both numbers together, never on one alone.
Because the new term is longer. Stretching the loan lowers the monthly payment but adds years of interest, and those extra years can cost more than the monthly saving gives back. On a current rate of 6.5% the monthly saving is $226.97/mo but the total saving is -$45,828.12; on a new rate of 7.0% the monthly saving is $221.07/mo but the total saving is -$59,434.63; and with twenty years left on the current loan the monthly saving is $618.13/mo but the total saving is -$73,487.47. Always read the monthly saving and the total saving side by side.
Closing costs divided by the monthly saving. On the defaults, $6,000.00 of closing costs divided by a $418.32/mo monthly saving gives a break-even of 14.34 months (month 15). If the monthly saving is zero or negative there is no break-even — the saving never covers the closing costs.
Work out both payments with the amortization formula, subtract for the monthly saving, then compare the totals. Current payment $2,216.97/mo a month, new payment $1,798.65/mo a month, saving $418.32/mo a month, break-even 14.34 months, total saving $11,577.49 on the defaults. See the guide to calculating mortgage refinance savings for the step-by-step method.