A mortgage refinance calculator compares the scheduled payments on your current loan with an estimate for a proposed replacement loan. Enter the current balance, rate, years remaining, proposed rate and term, and closing costs to compare monthly payments, a payment-based break-even month, and the total scheduled cost of both loans.
The result depends on the figures you enter. It is not a lender quote or a recommendation to refinance. A lower monthly payment does not necessarily mean a lower total cost, especially when the new loan lasts longer than the current term remaining.
What the comparison estimates
The calculator amortizes the current balance over the remaining term and compares it with a new loan. If you enter cash-out, that amount is added to the new loan principal. Closing costs are treated as a cash expense at the start, rather than added to the new principal.
The result includes the estimated payment on each loan, the monthly difference, total scheduled payments for each loan, closing costs, and an overall cost comparison. It models principal and interest only; it does not include property tax, homeowners insurance, mortgage insurance, or other ongoing expenses.
Enter current and proposed loan details
For the current loan, use the outstanding balance, current interest rate, and years remaining, not the original loan amount or original term — there is no down-payment step for a refinance, because the balance you owe today is the amount being replaced. For the proposed loan, enter the quoted rate, one of the supported terms (10, 15, 20, 25, or 30 years), and estimated closing costs. The current remaining term is entered in whole years. Land loans, commercial property, and mobile-home financing sit outside the conforming math this tool assumes, and their loans price differently.
As an example, compare a $250,000 balance at 7% with 24 years remaining against a proposed 30-year loan at 6%, with $6,000 in closing costs and no cash-out. The current payment estimate is $1,794.40 per month; the proposed payment is $1,498.88, a difference of $295.52 per month.
Understand break-even and total cost
The calculator's break-even month is the first month when cumulative new-loan payments plus the upfront closing costs are lower than cumulative payments on the current schedule. In the example, the modeled point is 21 months.
This is a payment cash-flow comparison, not an equity-adjusted break-even analysis. It does not compare how much principal remains on each loan at that month. Use the figure as one part of a comparison, and consider the balance and term as well as the payment.
The same example illustrates why the monthly payment and full-schedule result can point in different directions. Current scheduled payments total $516,786.35; the proposed 30-year payments plus closing costs total $545,593.37. Under these inputs, the new schedule costs $28,807.02 more overall despite the lower monthly payment, largely because the new term is six years longer than the 24 years remaining on the current loan.
Choosing the new term
The rate is only half the decision. Hold the $250,000 balance, the 7.00% current loan with 24 years left, the 6.00% new rate, and the $6,000 of cash closing costs constant, and the engine returns five different answers depending on the term:
| Loan | Monthly payment | Total paid including closing costs | Against the current schedule | Break-even month |
|---|---|---|---|---|
| Current, 24 years left | $1,794.40 | $516,786.35 | Baseline | Not applicable |
| Refinance, 10 years | $2,775.52 | $339,061.11 | $177,725.24 lower | None |
| Refinance, 15 years | $2,109.65 | $385,734.71 | $131,051.64 lower | None |
| Refinance, 20 years | $1,791.08 | $435,858.16 | $80,928.19 lower | None |
| Refinance, 25 years | $1,610.76 | $489,223.51 | $27,562.84 lower | 33 |
| Refinance, 30 years | $1,498.88 | $545,593.37 | $28,807.02 higher | 21 |
The rows do not rank in the order most borrowers expect. The 10-year loan saves $177,725.24 over its life and demands $981.12 more every month than the household pays now, a 55% increase, so it only works for someone who can absorb that. The 30-year loan is the only row with a meaningful monthly reduction ($295.52) and the earliest break-even (21 months), and it is also the only row that costs more than the loan it replaces. Of that $28,807.02, $22,807.02 is extra interest and $6,000 is the cash paid at closing.
The 20-year row is the one that looks harmless and is not. Its payment is $3.32 lower than the current one, but the cumulative outlay never falls below the current schedule while the two overlap, which is why the model reports no break-even month. A "None" in that column does not mean the payment is higher; it means the cash has not caught up by the time the shorter schedule ends. Read the last two columns together and the trap is visible: the cheapest full schedule has no break-even, and the fastest break-even is the most expensive loan.
These totals also cover different numbers of months, so the savings column is the cost of each complete schedule rather than money in hand at a common date. The next section explains why that distinction matters when the terms differ.
Comparing loans with different remaining terms
The total-payment figures are not a like-for-like cost when the terms differ. Here the current loan has 24 years left and the replacement runs 30, so the new total includes 72 payments that the current schedule never requires. Those extra years are not automatically a loss, because the household still needs housing after year 24 and the comparison gives no credit for cash that the current schedule would free up. But the raw totals cannot settle the question either.
A cleaner comparison stops at a common date, such as the end of the current loan's remaining term. At that month, add what each path has paid and add any balance still outstanding on the replacement. That balance is the part of the new loan the total-payment figure has not yet charged for. The calculator does not produce that number, which is why its break-even and its total cost answer different questions: break-even asks when the monthly cash flow turns favorable, while the total asks what the full schedules add up to.
Computed from the tool's own schedules at month 288, where the current loan's 24 years end: the current path has paid its full $516,786.35 and owes nothing. The refinance path has paid $431,677.44 in payments plus $6,000 of closing costs, and the new loan still owes $90,439.29 — so counting everything paid or still owed, it stands at $528,116.73, about $11,330.38 more than the loan it replaced, even though the raw full-schedule totals suggested the comparison ran the other way. Any sale or refinance before month 360 has to clear that $90,439.29 from the sale proceeds.
The note rate is not the full price
Closing costs raise the effective cost of the new loan above its interest rate, and the annual percentage rate is the measure that folds them in so two offers can be compared on one number. The CFPB explanation of rate versus APR covers what the APR includes and where it still falls short of a complete comparison. When two lenders quote different rates and different costs, compare the APRs and the break-even months together rather than ranking the note rates alone.
Model limitations
- Cash-out: The entered cash-out amount is added to the proposed loan principal and credited in the overall cost comparison. However, it is not treated as proceeds in the break-even calculation, so that result is incomplete for a cash-out refinance.
- Closing costs: The model treats these as paid in cash at closing. It does not roll costs into principal or model a lender-paid/no-cost refinance with a different rate.
- Other costs: Taxes, insurance, mortgage insurance, discount points, and other recurring or one-time expenses are not included.
- Loan terms: New terms are limited to 10, 15, 20, 25, or 30 years; the current term remaining is modeled in whole years.
- Eligibility: The calculator does not evaluate credit, income, equity, appraisal, lender requirements, or approval.
Before deciding, compare the current and proposed written loan terms, fees, balances, and expected time you will keep the loan. The CFPB's Loan Estimate guide explains how to review mortgage costs; this calculator is not a substitute for the lender's disclosures. For a payment estimate without a refinance comparison, use the Mortgage Calculator. To model additional principal payments, see the Mortgage Payoff Calculator. To compare discount points, use the Mortgage Points Calculator.
Last verified: October 2026. Calculator figures are outputs for the inputs entered; they are not live quotes, current rates, or an offer.