Refinance Break-Even Calculator

About this calculator

Refinancing a mortgage replaces your loan with a new one, usually at a lower rate, but it comes with closing costs — appraisal, title, origination, and lender fees that typically run 2-5% of the loan amount. The break-even point is the simple division closing costs ÷ monthly savings, which tells you how many months of lower payments it takes before the refinance actually starts putting money in your pocket.

Homeowners and mortgage brokers use this number as the single most important sanity check before refinancing: if you plan to sell or refinance again before reaching break-even, the new loan will cost more than it saves. It's especially relevant when rates drop only modestly, since a small monthly savings can push the break-even point out several years.