{
    "name": "Refinance Calculator",
    "url": "https://calculators.geekmidst.com/calculators/refinance-calculator",
    "markdown": "https://calculators.geekmidst.com/calculators/refinance-calculator.md",
    "category": "Finance",
    "description": "Compare your current mortgage or loan with a refinance: new payment, monthly savings, months to recover the closing costs and the lifetime saving.",
    "summary": "Refinancing pays off with a lower payment, but closing costs come first. The break-even point is how many months of savings it takes to earn those costs back.",
    "also_called": [
        "Mortgage refinance calculator",
        "Refinance break-even calculator"
    ],
    "applies_to": "Worldwide",
    "last_updated": "2026-10-29",
    "computation": "Results are computed in the visitor’s browser on the HTML page. This API describes the calculator; it does not compute results.",
    "inputs": [
        {
            "name": "balance",
            "label": "Current loan balance",
            "type": "number",
            "default": "250000"
        },
        {
            "name": "rate_current",
            "label": "Current interest rate",
            "type": "number",
            "default": "7",
            "unit": "%"
        },
        {
            "name": "months_left",
            "label": "Months left on current loan",
            "type": "number",
            "default": "300",
            "unit": "months"
        },
        {
            "name": "rate_new",
            "label": "New interest rate",
            "type": "number",
            "default": "5.5",
            "unit": "%"
        },
        {
            "name": "months_new",
            "label": "New loan term",
            "type": "number",
            "default": "300",
            "unit": "months"
        },
        {
            "name": "costs",
            "label": "Refinancing (closing) costs",
            "type": "number",
            "default": "4000",
            "optional": true
        },
        {
            "name": "costs_mode",
            "label": "Pay the costs",
            "type": "segmented",
            "default": "cash",
            "options": {
                "cash": "In cash",
                "loan": "Add to the new loan"
            }
        },
        {
            "name": "currency",
            "label": "Currency",
            "type": "currency",
            "default": "USD"
        }
    ],
    "outputs": [
        {
            "key": "monthly_saving",
            "label": "Monthly saving",
            "format": "currency"
        },
        {
            "key": "payment_current",
            "label": "Current monthly payment",
            "format": "currency"
        },
        {
            "key": "payment_new",
            "label": "New monthly payment",
            "format": "currency"
        },
        {
            "key": "break_even",
            "label": "Break-even",
            "format": "text"
        },
        {
            "key": "lifetime_saving",
            "label": "Lifetime saving (incl. costs)",
            "format": "currency"
        },
        {
            "key": "interest_current",
            "label": "Interest left on current loan",
            "format": "currency"
        },
        {
            "key": "interest_new",
            "label": "Interest on new loan",
            "format": "currency"
        }
    ],
    "formula": {
        "text": "Payment = P × i × (1 + i)^n ÷ ((1 + i)^n − 1);  Monthly saving = Current payment − New payment;  Break-even months = Costs ÷ Monthly saving (rounded up);  Lifetime saving = Current payment × months left − (New payment × new term + costs paid in cash)",
        "variables": {
            "P": "loan balance (plus costs if they are added to the new loan)",
            "i": "monthly rate",
            "n": "months"
        }
    },
    "worked_example": {
        "inputs": {
            "balance": "250000",
            "rate_current": "7",
            "months_left": "300",
            "rate_new": "5.5",
            "months_new": "300",
            "costs": "4000",
            "costs_mode": "cash",
            "currency": "USD"
        },
        "steps": [
            "Current: $250,000 at 7% over 300 months = $1,766.95 a month.",
            "New: $250,000 at 5.5% over 300 months = $1,535.22, saving $231.73 a month.",
            "Break-even: 4,000 ÷ 231.73 = 17.3, so 18 months. Over the full term you save ≈ $65,518.78 after costs."
        ],
        "result": "Refinancing from 7% to 5.5% saves $231.73 a month and recovers the $4,000 cost in 18 months."
    },
    "interpretation": "If you expect to sell or refinance again before the break-even month, the refinance loses money. A longer new term lowers the payment but can raise total interest, so check the lifetime saving as well as the monthly one.",
    "assumptions": [
        "Both loans are fixed-rate with level monthly payments, and the current payment is recalculated from the balance, rate and months left.",
        "Property tax and insurance are unchanged, so they are left out."
    ],
    "limitations": [
        "The simple break-even ignores the time value of money and differences in how fast each loan builds equity.",
        "Cash-out refinancing and mortgage insurance changes are not modelled."
    ],
    "rules": null,
    "faqs": [
        {
            "question": "How much of a rate drop makes refinancing worth it?",
            "answer": "There is no fixed rule. What matters is whether your monthly saving recovers the costs well before you expect to move or pay off the loan."
        },
        {
            "question": "Is rolling costs into the loan a good idea?",
            "answer": "It avoids paying cash now, but you pay interest on the costs for the whole term and the monthly saving shrinks."
        }
    ],
    "sources": [],
    "related": [
        {
            "name": "Mortgage Calculator",
            "url": "https://calculators.geekmidst.com/calculators/mortgage-calculator"
        },
        {
            "name": "Loan Amortization Calculator",
            "url": "https://calculators.geekmidst.com/calculators/loan-amortization-calculator"
        },
        {
            "name": "EMI Calculator",
            "url": "https://calculators.geekmidst.com/calculators/emi-calculator"
        },
        {
            "name": "Real Estate Calculator",
            "url": "https://calculators.geekmidst.com/calculators/real-estate-calculator"
        }
    ],
    "disclaimer": "This calculator gives estimates for planning. It is not financial advice, and lenders’ actual terms, fees and rounding may differ.",
    "publisher": "GM¹X CalcVerse"
}