Refinance Break-Even Calculator
A lower rate isn't automatically a good deal — closing costs have to be earned back first. Enter both loans and see your monthly savings, the exact break-even month, and lifetime interest side by side. Free, private, no signup.
Your numbers
Restarting a 30-year term lowers the payment but stretches interest over more years.
Fees, points, appraisal — typically 2-5% of the loan.
The verdict depends on this more than anything else.
Before vs after
Current loan
Monthly payment-
Total interest left-
Refinanced loan
Monthly payment-
Total interest-
You save per month-
Break-even point-
Lifetime interest saved-
Net gain if you stay 10 yrs-
Cumulative savings vs closing costs
■ Cumulative savings ■ Closing costs
How to read your break-even point
Refinancing has two moving parts: a lower monthly payment (good) and closing costs paid upfront (bad). The break-even month is when accumulated monthly savings finally cover what you paid to refinance. Every month after that is pure profit; sell or move before it and you lost money.
- The 1% rule of thumb. Refinancing usually makes sense when the new rate is at least ~1% lower AND you'll stay past break-even. Smaller rate drops can still work if closing costs are low (lender credits, no-point loans).
- Watch the term trap. Restarting a 30-year clock at a lower rate can cut your payment while increasing lifetime interest — you're borrowing for more years. Compare "same remaining term" first; only stretch the term if cash flow is the emergency.
- Points: do the same math. Paying discount points to buy a lower rate is just prepaid interest — divide the points cost by the extra monthly saving to get its own break-even.
- Your stay horizon decides everything. A 24-month break-even is great if you'll stay 10 years, terrible if you might move in 18 months. Be honest about the horizon.
FAQs
What is a good break-even period?
Under 24 months is excellent; under 36 is usually fine if you plan to stay. Beyond 48 months, think hard — life changes, and the savings may never materialise.
Should I roll closing costs into the loan?
You can, but then you're paying interest on the fees for decades. This calculator assumes you pay them upfront (or they come out of the savings). Rolling them in pushes break-even later.
Does refinancing restart my 30-year clock?
Only if you choose a new 30-year term. You can refinance into a 20, 15 or even custom term — this calculator lets you compare "same remaining term" against a fresh term so you see the lifetime-interest trade-off.
What about cash-out refinancing?
Different question — you're increasing the balance, so break-even math doesn't apply cleanly. Compare the new payment against what the cash will earn or save you elsewhere.
Is my data sent anywhere?
No. Everything is computed in your browser; nothing leaves your device.
Disclaimer: Estimates for illustration, computed in your browser — no data leaves your device. Actual refinance offers depend on credit, appraisal, lender fees and rate locks. We do not quote live rates. Verify with your lender before refinancing.