Mortgage Calculators level Refinance Calculator - How much to save by refinancing

Free Refinance Calculator to determine savings in refinance

Mortgage Refinance Calculator helps you find out how much you can save if you refinance your mortgage at the current low rates. It also enables you to calculate the time period during which you can break even or offset closing costs with the interest savings. Just enter the figures in the free Refinance Calculator (Refinance Analysis Calculator) and find out whether or not it is wise to go for refinancing.

Balance mortgage amount ($)

Monthly mortgage payment (Principal + Interest)

Current mortgage rate (% per annum)

Mortgage rate you will be refinancing at (% per annum)

Number of years you will be refinancing for

Closing costs

Would you like to finance the closing costs?

Interest saved by refinancing

Your monthly payment after refinance

Monthly payment reduction

Months for interest savings to offset closing costs
(break-even period)

Interest you pay for the current loan

Interest payable for the refinance loan

Total interest you will save

Net interest savings (Interest savings less closing costs)

How is it possible?

Disclaimer: The calculator here is made available to you as a self-help tool. Therefore, the accuracy of the figures with respect to your individual situation cannot be guaranteed.

How Mortgage Refinance Calculators work

Home Mortgage Refinance Calculators (Refinance Savings Calculators) require you to input variables such as:
  • Current monthly mortgage payment
  • Outstanding loan balance
  • Current mortgage rate
  • Interest rate of the new loan
  • Number of years you'll be refinancing for
  • Closing costs in dollars or percentage

The Home Mortgage Refinance Calculator (Refinance Analysis Calculator) will ask you whether you'll finance the closing cost, that is, whether you'll roll over the costs into the new loan. Once you enter the required values, the free Refinance Calculator (Refinance Analysis Calculator) will give you the following results.
  • Your monthly payment under the new loan
  • Reduction in monthly payment
  • Break-even period (Months to offset closing costs)
  • Total interest you pay under the new loan
  • Total interest you'll save over the life of the new loan
  • Net interest savings (Interest savings less closing costs)

How to calculate break-even period

The Refinance Mortgage Calculator (Refinance Break-even Calculator) figures out the break-even period, which is the minimum time period for which you should stay in your property so as to recover the closing costs.

Here's an example which explains how to calculate break-even period.

Let's say you have taken a mortgage worth $100,000 for 15 years. Your monthly payment at 8% interest rate is $955. Now, if you're refinancing at 6.5% for next 15 years, then your monthly payment (according to free Refinance Calculator) will be = $871.

So, you can save $ 955 - $871 = $84 on a monthly basis.

Now, the closing costs for refinancing = $1200

Break-even period = ($1200/$84) = nearly 14 months

Thus, it'll take you nearly 14 months to recover the closing costs by saving thousands of dollars on the new loan. This implies that you should stay in the property at least for 14 months in order to recoup the closing costs you've paid.

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