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Refinance Calculator – Should You Refinance Your Loan?

Compare your current loan against a refinanced loan. See monthly savings, interest savings, break-even period, and total net savings. Free refinance analysis tool.

Updated for 2026

By the GlobalCalqulate team, founded by Pavan Kusunuri · About our editorial standards

Current Loan

Current Balance ($)

Current Interest Rate (%)

Remaining Term (Years)

New Loan

New Interest Rate (%)

New Loan Term (Years)

Closing Costs ($)

Monthly Savings

$181.23

Break-even: 17 months

Current Monthly Payment

$1,350.41

New Monthly Payment

$1,169.18

Monthly Savings

$181.23

Total Remaining Interest (Current)

$205,124.30

Total Interest (New Loan)

$150,754.02

Interest Savings

$54,370.27

Break-Even Period

17 months

Total Net Savings

$51,370.27

✓ Reviewed and updated for accuracy using current official rates and widely accepted formulas.

How to Use This Calculator

Enter Current Loan

Input your remaining balance, current interest rate, and years left on the loan.

Enter New Loan Terms

Enter the new interest rate and term you're considering. Include closing costs for accurate break-even analysis.

Analyze the Results

Compare monthly payments, total interest, and the break-even period. If you plan to stay past the break-even point, refinancing saves you money.

Key Tips

✓
Refinancing usually makes sense when rates drop at least 1-2% below your current rate.
✓
If you plan to move or sell within the break-even period, refinancing costs more than it saves.
✓
A shorter new term increases monthly payments but dramatically reduces total interest.
✓
Closing costs typically range from 2-5% of the loan amount. Include all fees for accurate analysis.

Help & FAQs

Frequently Asked Questions

Clear answers to common questions to help you use this calculator confidently.

When does refinancing make sense?

Tap to view the answer

Refinancing makes sense when the new rate is significantly lower than your current rate AND you plan to stay long enough to recover closing costs.

What is break-even period?

Tap to view the answer

The break-even period is how many months it takes for monthly savings to exceed closing costs. After that, you start saving money.

How much can I save by refinancing?

Tap to view the answer

Savings depend on rate difference, loan balance, and term. Enter your details to see exact savings.

What are typical closing costs?

Tap to view the answer

Closing costs typically range from 2-5% of the loan amount and include appraisal, origination, and title fees.

Should I refinance to a shorter term?

Tap to view the answer

Shorter terms have higher payments but much lower total interest. Consider cash flow vs long-term savings.

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How to Use This Calculator

Enter Current Loan

Input your remaining balance, current interest rate, and years left on the loan.

Enter New Loan Terms

Enter the new interest rate and term you're considering. Include closing costs for accurate break-even analysis.

Analyze the Results

Compare monthly payments, total interest, and the break-even period. If you plan to stay past the break-even point, refinancing saves you money.

Understanding Your Results

Monthly Savings
Current payment minus new payment. Immediate monthly cash flow improvement.
Break-Even
Closing costs ÷ monthly savings. The number of months until savings exceed the cost of refinancing. Stay longer than this to profit.
Net Savings
Total interest savings minus closing costs. The actual amount you save over the full loan term.

Key Tips

✓
Refinancing usually makes sense when rates drop at least 1-2% below your current rate.
✓
If you plan to move or sell within the break-even period, refinancing costs more than it saves.
✓
A shorter new term increases monthly payments but dramatically reduces total interest.
✓
Closing costs typically range from 2-5% of the loan amount. Include all fees for accurate analysis.

When Does Refinancing Make Sense?

The Rate Drop Rule of Thumb

A common guideline is to refinance when rates drop at least 1-2% below your current rate. But the real test is the break-even calculation: divide closing costs by monthly savings. If you'll stay in the home (or keep the loan) longer than the break-even period, refinancing makes financial sense. The calculator shows your exact break-even point.

Closing Costs — The Hidden Factor

Refinancing isn't free. Closing costs typically run 2-5% of the loan amount ($4,000-$10,000 on a $200,000 loan) and include appraisal fees, origination charges, title insurance, and recording fees. Some lenders offer 'no-cost' refinances with a slightly higher rate. The calculator factors closing costs into your break-even and net savings.

Term Choice — Lower Payment vs Lower Total Cost

You can refinance into a shorter or longer term. A shorter term (e.g., 25 years → 15 years) may increase your monthly payment but saves massive amounts of total interest. A longer term lowers monthly payments but increases total interest. The calculator lets you compare any term combination.

Refinance Calculator – Should You Refinance Your Loan?

Current Loan

New Loan

How to Use This Calculator

Key Tips

Frequently Asked Questions

When does refinancing make sense?

What is break-even period?

How much can I save by refinancing?

What are typical closing costs?

Should I refinance to a shorter term?

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Current Loan

New Loan

How to Use This Calculator

Understanding Your Results

Key Tips

When Does Refinancing Make Sense?

The Rate Drop Rule of Thumb

Closing Costs — The Hidden Factor

Term Choice — Lower Payment vs Lower Total Cost

Example: $200,000 from 6.5% to 5%

Understanding Your Results

When Does Refinancing Make Sense?

The Rate Drop Rule of Thumb

Closing Costs — The Hidden Factor

Term Choice — Lower Payment vs Lower Total Cost

Example: $200,000 from 6.5% to 5%

Current Loan

New Loan

How to Use This Calculator

Key Tips

When does refinancing make sense?

What is break-even period?

How much can I save by refinancing?

What are typical closing costs?

Should I refinance to a shorter term?

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Current Loan

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How to Use This Calculator

Understanding Your Results

Key Tips

When Does Refinancing Make Sense?

The Rate Drop Rule of Thumb

Closing Costs — The Hidden Factor

Term Choice — Lower Payment vs Lower Total Cost

Example: $200,000 from 6.5% to 5%

Understanding Your Results

When Does Refinancing Make Sense?

The Rate Drop Rule of Thumb

Closing Costs — The Hidden Factor

Term Choice — Lower Payment vs Lower Total Cost

Example: $200,000 from 6.5% to 5%