Mortgage Refinance Break Even Calculator

Mortgage refinancing is a strategic financial move that many homeowners consider to reduce their monthly payments. One crucial factor in deciding whether to refinance is the break-even point—the time it takes for the accumulated monthly savings to offset the costs of refinancing. Our Mortgage Refinance Break Even Calculator simplifies this process, helping you make informed decisions about refinancing your mortgage.

Formula: The formula used to calculate the monthly savings is:

Monthly Savings=(Current Interest Rate−Refinanced Interest Rate100)×Loan Amount÷12Monthly Savings=(100Current Interest Rate−Refinanced Interest Rate​)×Loan Amount÷12

How to Use:

  1. Enter your current loan amount.
  2. Input your current interest rate.
  3. Specify the new interest rate after refinancing.
  4. Click the “Calculate” button to determine your potential monthly savings.

Example: Suppose you have a $200,000 loan with a current interest rate of 4.5%, and you are considering refinancing at a lower rate of 3.8%. The calculator will provide you with the estimated monthly savings.


  1. What is the break-even point?
    • The break-even point is the time it takes for your accumulated monthly savings to equal the costs of refinancing.
  2. How accurate is the calculator?
    • The calculator provides an estimate. Actual savings may vary based on individual circumstances and market conditions.
  3. Can I use this calculator for any loan amount?
    • Yes, the calculator is designed for any loan amount.
  4. Is there a recommended difference in interest rates for refinancing?
    • While any reduction in interest rate can be beneficial, a 1-2% difference is often considered significant.
  5. Does the calculator account for all refinancing costs?
    • No, it focuses on the interest rate difference. Additional costs should be considered separately.

Conclusion: Our Mortgage Refinance Break Even Calculator offers a quick and efficient way to assess the potential benefits of refinancing your mortgage. Remember, individual circumstances vary, so it’s essential to consider all aspects of refinancing and consult with a financial advisor if needed. Use this tool to make informed decisions about your mortgage and financial future.

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