Refinance Breakeven Calculator
Should you refinance? Calculate exactly how long it takes to recoup closing costs and determine if it's a financial win.
Typically 2-5% of the loan amount.
Your Refinance Analysis
Time to Break Even
0 Months
Calculating...
No Savings!
The new loan increases your monthly payment. Refinancing does not make sense.
Monthly Savings
$0
5-Year Net Savings
$0
Does not reflect total interest.
Lifetime Interest Saved
$0
(Cost of extending your loan term)
Current Mortgage
New Mortgage
How to Use This Refinance Calculator
The breakeven point is the single most important metric. It tells you exactly how many months it will take for your monthly savings to offset the closing costs. Until you reach this point, you've essentially lost money.
The Golden Rule: If you plan to sell or move before reaching the breakeven point, refinancing will cost you money. If your breakeven is 24 months but you move in 18, you lose.
A breakeven under 2 years is excellent. 2-4 years is good. Over 5 years carries risk if your plans change.
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Frequently Asked Questions
What is a refinance breakeven point?
The month where your total interest savings exceed the closing costs you paid to refinance. Before this point, you have lost money; after this point, you serve to save money.
What closing costs should I expect?
Typically 2-5% of your total loan amount. These include appraisal fees, origination fees, title insurance, and recording fees.
How long should I stay in the home to make it worth it?
You should stay longer than your breakeven point. If your breakeven is 24 months, you need to stay in the home for at least 2 years to benefit from the refinance.
Should I refinance to a 15-year mortgage?
A 15-year mortgage usually comes with a lower interest rate, offering massive lifetime interest savings. However, it will likely increase your monthly payment significantly. Use the tool to compare the trade-off.
Can I roll closing costs into the loan?
Yes, this is often called a "no-closing-cost" refinance. However, you aren't avoiding the costs; you are adding them to your principal balance and paying interest on them for the life of the loan.
Does refinancing hurt my credit score?
Temporarily, yes. The lender's hard inquiry will dip your score by a few points, but standard loan payments will help it recover quickly, often within a few months.