Find when closing costs are recovered - And whether the new term quietly increases lifetime cost.
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The payment break-even is only one checkpoint. Old and new balances also need comparison at your likely exit date.
Use same-day payoff and refinance figures, then test how long you realistically expect to keep the loan.
The calculator models the existing and replacement loans from today. Simple break-even divides closing costs by monthly payment reduction; the five-year comparison also includes the difference between remaining loan balances, which exposes the cost of restarting a longer term.
Escrow timing, cash-out, taxes, mortgage insurance, prepayment charges and opportunity cost are excluded. A lower payment can coexist with a higher lifetime cost.
This calculator supports The Real Cost of Borrowing. Mortgage Refinance Break-Even: Payment Savings Are Only the First Test explains which details can change the inputs. The calculation methodology shows how we handle timing, rounding and exclusions.
Use same-day payoff and refinance figures, then test how long you realistically expect to keep the loan. Inputs remain in the browser and outputs are rounded for display.
Read the complete methodology →Simple break-even divides closing costs by monthly payment reduction, while the fuller comparison also measures balances at the planned exit date.
It can. Restarting a longer term may leave a larger balance, so lower monthly payments do not automatically produce a net saving.
Find whether an upfront rate buy-down is recovered before you sell or refinance.