Last updated: March 2026
Deciding to refinance your mortgage requires looking closely at the numbers. This calculator helps you compare your current home loan with a new proposal. Enter your current loan details and the new offer to estimate your monthly savings, total upfront costs, and exactly how many months it will take to break even.
We built this calculator to give you a clear and unbiased look at refinancing. Mortgage lenders often highlight lower monthly payments to secure your business, but they might downplay closing costs or the impact of extending your loan term. This tool puts all the variables together so you can make an informed choice based on total costs and realistic break-even points, rather than just the monthly payment difference.
Refinancing is a major financial commitment. Here are some real-world situations where running these numbers makes sense:
The tool works by comparing the remaining balance and projected interest of your current mortgage against the specific terms of a proposed new loan. It takes your new interest rate, desired loan duration, and any closing costs or discount points you plan to pay.
By calculating the difference between your old monthly payments and your new ones, the tool factors in the upfront costs to reveal your break-even point. The break-even point is the exact month where your accumulated monthly savings finally equal what you spent to close the loan. The calculator also forecasts your lifetime savings to show you the long-term impact of the decision.
This calculator provides mathematical estimates to guide your decision-making process. However, actual loan offers will vary. The results here depend entirely on the accuracy of your inputs.
Keep in mind that property taxes, home insurance premiums, and specific lender fees can change the exact math. Escrow accounts are not factored into the basic principal and interest payments shown here. Always review an official Loan Estimate provided by your lender before finalizing a refinance to confirm all costs.
It certainly can. Mortgage interest is generally tax-deductible if you itemize your deductions. If you refinance and lower your interest rate, the amount of interest you pay goes down, which means your tax deduction may decrease. However, the actual cash savings from a lower interest rate usually outweigh the loss of the tax deduction. We recommend consulting a tax professional for advice tailored to your financial situation.
There is no legal limit to how often you can refinance a mortgage. That said, most lenders enforce a seasoning requirement. This means they typically ask that you wait 6 to 12 months between new loans. Keep in mind that frequent refinancing requires paying closing costs repeatedly, which can quickly erase any potential financial savings.
Requirements vary depending on the lender and the specific type of loan. Generally, a credit score of 620 or higher is needed for conventional loans. FHA and VA loans have more flexible guidelines and may allow for scores as low as 580. A higher credit score will directly result in a lower interest rate offer.
Historically, financial experts advised homeowners to refinance only if they could drop their rate by at least 1 to 2 percent. Today, with larger average loan amounts, even a 0.5 percent reduction can result in meaningful savings. You should run your specific numbers through the calculator to see if the long-term savings justify the upfront costs for your unique situation.