Refinance Breakeven Calculator

The breakeven point is the single most important metric when deciding whether to refinance your mortgage. It tells you exactly how many months it will take for your monthly savings to offset the closing costs you paid upfront. Until you reach this point, you've essentially lost money by refinancing.

The golden rule: If you plan to sell your home or move before reaching the breakeven point, refinancing will cost you money. For example, if your breakeven is 36 months (3 years) but you plan to move in 2 years, you'll never recoup those closing costs. Conversely, if you plan to stay 10+ years and your breakeven is just 18 months, refinancing is almost certainly worth it — you'll enjoy over 8 years of pure savings.

Pro tip: A breakeven under 2 years is generally considered excellent. Between 2-4 years is good if you're confident you'll stay. Over 5 years means you should think carefully about your plans before proceeding. Also consider that refinancing to a shorter term (like 15 years) may increase your payment but save you significantly more in total interest over the life of the loan.