**Free Refinance Calculator to determine savings in refinance**

**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

- 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

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.