Your current mortgage
New loan
Your plan
If you move before the break-even month, you'll eat the closing costs. The plan-horizon above is what makes or breaks the deal.
Break-even
16 mo
Save $386/mo · $6,000 closing costs recouped in 1.3 years
Cumulative savings
horizon · 8 yr
Current payment (P&I)
$2,253
7.25% · 27 yr remaining
New payment (P&I)
$1,867
5.75% · 30 yr
Monthly savings
$386
Freed-up cash flow
Lifetime interest delta
+$57,832
Interest saved vs. keeping current loan
Show the mathExpand →
Each loan's monthly P&I uses the standard amortization formula:
M = L · r(1 + r)n / ((1 + r)n − 1)
Break-even = closing costs ÷ monthly savings. Cumulative savings = monthly savings × months − closing costs. When the line crosses zero, you've earned the closing costs back.
Lifetime interest delta compares allinterest paid on the current loan vs. the new loan. A 30-year refi at a slightly lower rate can still cost more lifetime interest because you've reset the clock — that's why this matters.
We don't model prepayment penalties, discount points, or closing-cost financing (rolling costs into the loan). Ask your lender for a Loan Estimate and compare line-by-line.
How this break-even is calculated
Both payments from the same amortization formula
Current and new monthly P&I are computed identically — the only differences are rate and term. That makes the month-over-month delta apples-to-apples.
Break-even = closing costs ÷ monthly savings
Divide what you spend to refi by what you save each month. The quotient — in months — is when the refi actually starts putting money in your pocket.
Plan horizon is the honest filter
If you sell or refi again before break-even, the closing costs never got recouped. Enter the years you realistically plan to stay — that's the number that decides this.
Try another calculator next
Mortgage calculator
Full PITI — what the new loan actually costs.
Open toolRent vs. buy
If you're unsure you'll stay, this is the prior question.
Open toolCompound interest
Invest the monthly savings instead — what does it grow to?
Open toolHome equity calculator
What's the cash-out refi option actually worth?
Open tool