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Refinance break-even calculator: when does it pay off?
A refinance is worth it when the savings repay the costs before you move or refinance again. This calculator shows the break-even month.
Months to break even
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Estimate only, using the numbers you entered. Not a loan offer, rate quote or approval. Get Mortgage Funnels is not a lender.
How it works
When does a refinance pay off?
A refinance breaks even when cumulative monthly savings equal the closing costs. Break-even months = total closing costs ÷ monthly payment savings. If you expect to stay in the home longer than that, the refinance may make sense — before considering term changes and total interest.
The math
Current and new P&I from the amortization formulaMonthly savings = current P&I − new P&IBreak-even months = closing costs ÷ monthly savings
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On your site, it does one more thing
On client sites, every calculator ends with a button into the matching funnel, so a borrower who just ran the numbers can start a real conversation. This one pairs with the refinance cash out funnel.
See the matching funnelFAQ
Refinance break-even calculator questions
Can't find it? Search every answer or ask the funnel desk.
When does a refinance pay off?
When your total monthly savings exceed the closing costs. Divide closing costs by monthly savings to get break-even months; if you will keep the loan longer than that, the refinance may be worthwhile.
Why can total interest go up even with a lower rate?
Restarting a 30-year term on a loan that had 27 years left stretches repayment. The calculator shows remaining interest for both so you can see the trade-off.
Should closing costs be rolled into the loan?
It is possible in many refinances, but it raises the balance and the interest paid. The break-even math still applies — the costs are just paid over time.
Does cash-out change the math?
Yes. A cash-out refinance raises the balance, so compare it with alternatives such as a HELOC. Our HELOC funnel and refinance funnel cross-link for that reason.
What is a good break-even period?
There is no universal number; it depends on how long you will keep the loan. Many homeowners compare break-even against their expected time in the home.
Are the rates here real?
No — they are inputs you choose. Real refinance pricing depends on your credit, equity and loan type; a loan officer provides it.
Can I remove mortgage insurance by refinancing?
Sometimes, if your equity has grown. The refinance funnel asks about this goal specifically.
Is this calculator on client sites?
Yes, included with every plan and linked to the refinance funnel.
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