Should you refinance? Calculate monthly savings, break-even point, and lifetime interest saved. Compare your current mortgage vs the new refinanced loan side by side.
Current Mortgage
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years
New Loan
%
$
Monthly Savings
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Break-Even
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Current Payment
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New Payment
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Monthly Savings
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Lifetime Interest Saved
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Current Monthly Payment
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New Monthly Payment
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Monthly Savings
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Closing Costs
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Break-Even (months)
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Total Interest (current)
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Total Interest (new loan)
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Lifetime Interest Saved
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FAQ
When should I refinance?
Refinance when: (1) New rate is ≥0.75-1% lower than current, (2) You plan to stay in the home past the break-even point, (3) Your credit score has improved, (4) You want to switch from ARM to fixed rate.
What is the break-even point?
Break-even = Closing Costs ÷ Monthly Savings. If closing costs are $6,000 and you save $200/month, break-even is 30 months. Stay in the home longer than that and refinancing is worthwhile.
What are typical refinancing costs?
Closing costs typically run 2-5% of the loan amount ($4,000-$12,000 on a $250K loan). They include origination fees, appraisal, title insurance, and prepaid items. Some lenders offer "no-closing-cost" refinance with higher rates.
Does refinancing restart my loan term?
Yes, refinancing to a 30-year loan restarts your amortization. You may save monthly but pay more total interest. Refinancing to a 15-year loan costs more per month but saves significantly on total interest.