Loan refinance calculator
Refinancing only pays off if the savings cover its costs. Enter both loans to see whether it is worth it.
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How to use it
- Enter current balance, current rate, months left now, new rate, new term and refinancing costs.
- The result appears straight away and updates as you edit.
- Copy the result, or copy a link that keeps the same values to share it.
How it is calculated
Current payment = B × r1 ÷ (1 − (1 + r1)^−n1), new payment likewise with r2 and n2. Net saving = current × n1 − new × n2 − costs. Break-even months = costs ÷ monthly saving.
Example
Inputs: Current balance = 150,000, Current rate = 7 %, Months left now = 240 months, New rate = 5 %, New term = 240 months. Result: Monthly saving: 173.01; Current payment: 1,162.95; New payment: 989.93.
Limits and caveats
- Assumes costs are paid in cash, not added to the new loan.
- A longer term lowers the payment but can raise total interest, so check the net saving, not only the payment.
Questions about this tool
When is refinancing worth it?
When the net saving is positive and you expect to keep the loan longer than the break-even period.
Why is net saving negative with a lower payment?
A longer new term means more payments, so the total can rise even as the payment falls.
What does break-even mean?
The number of months it takes for the monthly saving to cover the refinancing costs.