Mortgage Refinance Calculator

Refinancing normally pays off the old mortgage and creates a new loan. That means the analysis should begin with the current remaining balance, current payment, interest rate, and remaining time to pay it off. The proposed loan then needs its own rate, term, closing-cost treatment, and any cash-out amount. Comparing only the headline rate can hide a longer term, a larger balance, or a different amount due at closing.

This calculator puts those two schedules side by side. Its purpose is to make the arithmetic inspectable, not to announce that a refinance is good or bad. It cannot see the actual offer, a lock agreement, points, lender credits, a property appraisal, taxes, or a future move. For a broader explanation of the inputs, see the existing Should I Refinance My Mortgage? guide, then return here with the specific figures you want to test.

For each fixed-rate path, the principal-and-interest payment is calculated from the modeled balance, monthly rate, and number of payments. The payment equation is:

For the replacement path, this page first builds a new principal: current balance + any cash out + closing costs if you select “roll in.” It then creates a fresh amortization schedule. The current path uses the payment you enter when provided, so it can model the remaining payoff schedule instead of assuming the original loan has just begun. This distinction is essential when the current loan has already been paid down for years.

Assume a remaining balance of $220,000, a fixed 6.5% rate, and 300 months left. The standard formula gives a current principal-and-interest payment of $1,485.46. A hypothetical replacement with the same $220,000 balance at 5.75% over a new 360-month term gives $1,283.86 before any closing costs are added. The modeled monthly difference is $201.60.

That lower payment does not by itself show a lower lifetime cost: the new term is 60 months longer in this example. Add a realistic closing-cost number and test it both out of pocket and rolled into the balance. Then compare the total remaining interest and payoff dates alongside the payment. This is exactly why a refinance screen should show a schedule rather than stopping at the monthly amount.

When closing costs are paid out of pocket and the modeled replacement payment is lower, this page calculates a simple cash break-even: out-of-pocket closing costs divided by the monthly payment difference. For example, a $3,000 out-of-pocket cost divided by a modeled $200 monthly difference gives 15 months. It is a useful checkpoint: if the loan ends, is sold, or changes before that point, the simple payment savings have not yet offset those cash costs.

A rolled-in cost needs a different reading. It may make the out-of-pocket cash value appear to be zero while increasing the principal that earns interest. Compare the new balance and total remaining interest directly. Do not treat either approach as universally better; the calculator is showing two ways an input changes a schedule, not choosing an offer.

A lender's application-specific figures are more detailed than a generic model. The CFPB explains that a Loan Estimate provides expected rate, payment, closing costs, taxes, insurance, and certain loan features. Compare those entries with the inputs you use here, including whether the quoted payment includes escrow items or only principal and interest.

Also test the result with the same remaining term, a shorter term, and the term offered. A lower payment caused by a longer term answers a cash-flow question; it does not answer the total-cost question. Use the Mortgage Calculator for a clean payment composition and the Amortization Calculator to inspect a single schedule without refinance assumptions.

1. Use the current payoff balance, not the original loan amount.
2. Record the current payment and remaining months from current records.
3. Enter the proposed rate, rate type, term, cash-out amount, and every fee you know.
4. Run closing costs both paid now and rolled into principal if each is available.
5. Compare payment, payoff date, remaining interest, and cash-to-close before treating a lower payment as a savings claim.

If the math or a label needs correction, report it with non-sensitive sample inputs through the page's issue form. The site will not ask you to put account numbers, an application, or private lender documents into the report.