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.
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:
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.
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.