Current Loan
Your Existing MortgageNew Loan
Refinance OptionYour Results
Refinancing could save you $467/month ($5,604/year). You'll break even on closing costs in 23 months. Over the life of the loan, you'll save $81,523 total in interest.
Refinancing Could Save You Money
You'll break even in 23 months and save $67,523 total
Monthly Payment Comparison
Break-Even Analysis
Total Savings Over Loan Life
Detailed Loan Comparison
| Current Loan | New Loan | Difference | |
|---|---|---|---|
| Loan Amount | $280,000 | $280,000 | $0 |
| Interest Rate | 7.5% | 6.5% | -1.0% |
| Loan Term | 27 years | 30 years | +3 years |
| Monthly Payment | $2,237 | $1,770 | -$467 |
| Total Payments | $724,884 | $637,361 | -$87,523 |
| Total Interest | $444,884 | $357,361 | -$87,523 |
| Payoff Date | Dec 2051 | Jan 2055 | +3 years |
Cumulative Savings Over Time
See when refinancing starts paying off and how much you'll save
When Does Refinancing Make Sense?
Good Time to Refinance
- Rate drop of 0.75% or more
- You'll stay in home past break-even
- Credit score has improved significantly
- Want to switch from ARM to fixed rate
- Need to remove PMI
- Want to shorten your loan term
Maybe Not the Best Time
- Rate drop is less than 0.5%
- Planning to move within 2-3 years
- Loan balance is very low
- You're late in your current loan term
- High closing costs with minimal savings
- Extending term significantly increases interest
Frequently Asked Questions
The break-even point is when your cumulative savings from the lower monthly payment equals the closing costs you paid to refinance. Before this point, you're still "paying back" the refinance costs. After it, you're truly saving money.
Refinancing to a longer term (like going from 20 years remaining to a new 30-year loan) will lower your monthly payment but usually increases total interest paid. It makes sense if you need payment relief, but consider keeping your current payoff timeline if possible.
Cash-out refinancing lets you borrow more than you owe and take the difference as cash. For example, if you owe $200,000 on a home worth $350,000, you might refinance for $250,000 and receive $50,000 in cash. This increases your loan amount and monthly payment.
Closing costs for refinancing typically range from 2-5% of the loan amount. On a $280,000 loan, that's $5,600 to $14,000. Costs include appraisal ($300-600), title insurance, origination fees, and various administrative fees.
Yes, but your options may be limited. FHA streamline refinances don't require a new credit check if you're current on payments. For conventional refinancing, you'll typically need a credit score of at least 620, and the best rates require 740+.