Refinance Savings Calculator

See your monthly and lifetime savings from refinancing. Compare the total cost of your current loan vs a new loan, including closing costs.

$
%
yrs
%
$
Lifetime Savings
$5,390 more expensive
$345/month savings on payment
Current Monthly Payment
$2,069
New Monthly Payment
$1,724
Monthly Payment Savings
$345
Interest Savings
$110
Current Total Remaining
$620,753
New Total Cost (inc. fees)
$626,143

How to Use This Refinance Savings Calculator

Enter your Current Loan Balance, Current Rate, and Years Remaining on your existing mortgage. Then enter the New Rate, New Term, and estimated Closing Costs for the refinanced loan. The calculator compares the total cost of both scenarios over their full remaining life.

Pay close attention to the "Lifetime Savings" figure — this is the true measure of whether refinancing makes financial sense, not just the monthly payment change.

Refinance Savings Formula

Current Total Remaining = Current Payment × (Years Remaining × 12)
New Total Cost = New Payment × (New Term × 12) + Closing Costs
Lifetime Savings = Current Total Remaining − New Total Cost

Monthly Savings = Current Payment − New Payment
Interest Savings = Current Total Interest − New Total Interest

Example: Dropping from 7.5% to 6.25%

$280,000 Balance, 25 Years Remaining

Current Payment (7.5%, 25 yr)$2,062/mo
New Payment (6.25%, 30 yr)$1,724/mo
Monthly Savings$338/mo
Current Total Remaining (25 yrs)$618,600
New Total Cost (30 yrs + $5,500 fees)$626,145
Lifetime Savings−$7,545 (costs more!)
Interest Savings (rate only)$44,000

Important insight: even though the monthly payment is lower, extending from 25 remaining years to a new 30-year loan adds 5 more years of payments — which can wipe out or even reverse the interest savings. Refinancing to a shorter term (e.g., 20 years) would show true lifetime savings.

Frequently Asked Questions

Savings depend heavily on the rate difference, loan balance, and new term. Dropping from 7.5% to 6.25% on a $280,000 balance saves $338/month. But if you extend the term, lifetime savings can be negative. Refinancing to the same remaining term (e.g., matching 25 years remaining with a 25-year new loan) maximizes lifetime savings.
Shorter terms save dramatically on total interest. Refinancing from 30 years at 7% to 15 years at 6.25% on a $280,000 loan saves $150,000+ in interest over the loan life, though monthly payments increase. This is one of the most financially powerful moves a homeowner can make if the higher payment is comfortable.
Closing costs directly reduce your lifetime savings. $6,000 in costs at $200/month savings means 30 months before you're ahead. Many homeowners focus only on monthly savings and overlook that closing costs must be fully recouped first. This calculator includes closing costs in the total comparison so you see the true bottom line.
Refinancing typically doesn't make sense when: you plan to move before break-even, the rate difference is minimal (under 0.5%), your loan is nearly paid off (most of your payment is principal now), or you'd extend to a much longer term. Also consider refinancing costs relative to your remaining loan balance.
Yes. A new loan starts a fresh amortization schedule, meaning your early payments are again mostly interest. If you've been paying your current mortgage for 5+ years, you've built some momentum toward paying principal — resetting to a 30-year loan loses that momentum. This is why matching your new term to your remaining years matters.

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