Mortgage Refinance Calculator
Compare your current mortgage with refinancing options to determine if refinancing makes financial sense for you.
Current Mortgage Details
New Mortgage Details
Refinance Analysis
Monthly Savings
Break-even Time
Total Savings
New Monthly Payment
Understanding Mortgage Refinancing
Mortgage refinancing means replacing your existing mortgage with a new one, typically to take advantage of lower interest rates, change the loan term, or access home equity. Understanding when refinancing makes sense can save you thousands of dollars over the life of your loan.
Benefits of Refinancing
- Lower Monthly Payments: Reduce your monthly payment by securing a lower interest rate or extending your loan term.
- Reduce Interest Rate: Even a 1% reduction in interest rate can save tens of thousands over the loan life.
- Change Loan Term: Switch from a 30-year to 15-year mortgage to pay off your home faster and save on interest.
- Cash-Out Equity: Access your home equity for home improvements, debt consolidation, or other expenses.
- Remove PMI: If your home value has increased, refinancing can help you eliminate private mortgage insurance.
- Switch Loan Types: Convert from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage for payment stability.
When Should You Refinance?
Good Times to Refinance
- • Interest rates drop at least 0.5-1% below your current rate
- • Your credit score has improved significantly since you got your original loan
- • You plan to stay in the home long enough to recoup closing costs
- • You want to switch from an ARM to a fixed-rate mortgage
- • Home values have increased and you can eliminate PMI
- • You need to access home equity for important expenses
Consider Carefully
- • You're planning to move within a few years (may not reach break-even point)
- • Your credit score has decreased (may not qualify for better rates)
- • You're far into your current mortgage term (most interest already paid)
- • Closing costs are very high relative to potential savings
- • You're considering cash-out refinance for non-essential purchases
Typical Refinancing Costs
Refinancing typically costs 2-5% of the loan amount. Understanding these costs helps you calculate the break-even point:
Common Closing Costs
- • Application fee: $75-$500
- • Appraisal fee: $300-$700
- • Title search and insurance: $700-$900
- • Origination fee: 0.5-1% of loan
- • Credit report fee: $25-$50
- • Attorney fees: $500-$1,000
Ways to Reduce Costs
- • Shop around with multiple lenders
- • Negotiate or waive certain fees
- • Consider a no-closing-cost refinance
- • Use the same title company
- • Time your refinance strategically
- • Bundle services when possible
Note: This calculator provides estimates based on the information you enter. Actual refinancing terms and savings may vary based on your credit score, home value, lender requirements, and current market conditions. Closing costs can vary significantly by lender and location. Consider all factors including how long you plan to stay in the home, your financial goals, and the total cost of refinancing. Consult with a mortgage professional for accurate rates, terms, and personalized advice.
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