Refinance Break-Even Calculator
Know the exact month your refinance stops costing money and starts saving it.
What This Calculator Does
Divide what the refinance costs by what it saves each month and you get the break-even point. This calculator runs that arithmetic on your actual numbers — old payment, new payment, and closing costs — then measures the result against how long you plan to hold the property.
Who Is This For
Owners weighing a lender's refinance offer, buyers who expect to move within a few years, and anyone who wants a simple pass-or-fail test before paying closing costs a second time.
How It Works
Enter your current monthly payment, the new payment you have been quoted, and your estimated closing costs. Add the number of years you expect to stay in the home, and the calculator will tell you whether you clear break-even before you leave.
Frequently Asked Questions
How is the break-even point calculated?
Total closing costs divided by monthly savings gives the number of months needed to recover the expense. As an illustration, $6,000 in costs against $200 a month in savings breaks even at month 30. Staying past that point is profit; leaving before it is a loss.
What if I roll the closing costs into the loan?
Rolling costs in avoids paying cash up front, but they still show up — as a larger balance and more interest. Break-even does not disappear, it just moves from your bank account into the loan. Run the comparison with the costs included either way.
Does a shorter term change the break-even math?
It does, often in the opposite direction. Refinancing from a 30-year into a 15-year term usually raises the monthly payment, so there is no monthly saving to divide into the closing costs. The payoff there is lifetime interest, not break-even months — judge that refinance on total interest saved instead.
Should I refinance if I might move soon?
If a sale is likely before break-even, the refinance costs you money. Miami owners with seasonal plans, a possible relocation, or a property they may convert to a rental should be conservative with the holding-period input — the shorter your realistic horizon, the higher the bar a refinance has to clear.
Do closing costs vary between lenders?
Significantly. Origination fees, title charges, and points differ from one lender to the next even on identical loans, and refinance closing costs commonly land anywhere in the 2-6% of loan amount range. Collect Loan Estimates from several lenders and compare the same line items.