Three numbers decide the comparison
Before you touch a calculator, get the statement. You need the balance, the rate, and how many years are actually left. People remember the original term. The comparison cares about what is left.
On the new loan, you need a quoted rate, a term, and a closing-cost number from a loan estimate. This site's refinance tool adds those costs to the balance, which is what happens when you finance them. If you plan to pay the costs in cash, the new loan is smaller than the model, and you should lower the balance yourself.
Payment and interest can move in opposite directions
Restarting a 30-year term is the usual way a refinance 'saves' money every month. It also gives interest more years to accumulate. Look at both lines. A payment that feels easier can be the more expensive loan if you keep it to the end.
Break-even only appears when the new payment is actually lower. If it is not, there is no month when the closing costs pay for themselves, and the page says so instead of printing a nonsense number.
| Question | Where it shows |
|---|---|
| Is the payment lower? | Monthly savings |
| When do costs come back? | Break-even, if savings are positive |
| Does the full term cost less interest? | Interest on each loan |
Calculators
Related guides
Sources
Common questions
Does this include cash out?
No. Cash-out starts from a larger balance. Read that guide and raise the balance yourself if you are testing it.
Are the rates current?
No. Type the rate on your statement and the rate on a loan estimate.