Refinance Calculator
A refinance calculator helps homeowners determine the benefits and costs of refinancing their mortgage. Calculate monthly payment savings, interest savings, and break-even points for mortgage refinancing and home loan refinancing decisions.
Refinance Calculator
Use this calculator for mortgage refinancing, home refinancing, and refinance analysis.
Results:
| New Monthly Payment | $2,020.00 |
| Monthly Savings | $440.00 |
| Total Interest Savings | $125,000.00 |
| Break-even Point | 14.5 months |
| Total Closing Costs | $6,400.00 |
| Net Savings (5 years) | $19,800.00 |
| Net Savings (10 years) | $46,400.00 |
| Recommendation | Refinance |
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| View Refinance Analysis | |
Cash-out Refinance Calculator
Calculate the benefits and costs of cash-out refinancing to access home equity.
Results:
| New Loan Amount | $370,000.00 |
| Cash Received | $42,600.00 |
| New Monthly Payment | $2,460.00 |
| New LTV Ratio | 74.0% |
| Available Equity | $180,000.00 |
| Remaining Equity | $130,000.00 |
| Total Cost of Cash | $57,400.00 |
| Effective Cash Rate | 8.2% |
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| View Cash-out Analysis | |
ARM Refinance Calculator
Calculate the benefits of refinancing from an adjustable-rate mortgage to a fixed-rate mortgage.
Results:
| Fixed Payment | $2,020.00 |
| ARM Payment (Current) | $1,840.00 |
| ARM Payment (After Adjustment) | $2,280.00 |
| Rate Protection Value | $250,000.00 |
| Payment Stability | Guaranteed |
| Break-even Time | 24.6 months |
| 5-Year Savings | $9,200.00 |
| Recommendation | Refinance to Fixed |
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| View ARM Analysis | |
Understanding Mortgage Refinancing
Mortgage refinancing replaces your current mortgage with a new loan, potentially offering better terms, lower rates, or access to home equity. Understanding refinancing options and costs helps make informed decisions about mortgage optimization.
| Refinance Type | Purpose | Best For | Typical Costs | Key Benefits |
|---|---|---|---|---|
| Rate & Term | Lower rate/change term | Rate reduction | 2-5% of loan | Lower payments, interest savings |
| Cash-out | Access home equity | Home improvements | 2-6% of loan | Cash for projects, debt consolidation |
| Cash-in | Reduce loan balance | Remove PMI | 2-5% of loan | Lower payments, eliminate PMI |
| Streamline | Simplified process | Government loans | 1-3% of loan | Reduced documentation, faster process |
Refinancing Decision Factors
Several factors determine whether refinancing makes financial sense for your situation.
Refinancing Guidelines
| Factor | Guideline | Consideration | Impact |
|---|---|---|---|
| Rate Reduction | 0.5-1.0% minimum | Break-even analysis | Monthly savings vs. costs |
| Break-even Period | 2-3 years maximum | How long you'll stay | Time to recover costs |
| Credit Score | 620+ for best rates | Score improvement since original loan | Rate qualification |
| Home Equity | 20%+ for best terms | Current home value | LTV ratio and PMI |
Refinancing Costs
Understanding all costs involved in refinancing helps calculate true savings and break-even points.
Typical Refinancing Costs
| Cost Type | Typical Range | Description | Negotiable |
|---|---|---|---|
| Origination Fee | 0.5-1.5% of loan | Lender processing fee | Yes |
| Appraisal | $300-$700 | Property valuation | Limited |
| Title Insurance | $500-$2,000 | Title protection | Limited |
| Recording Fees | $50-$500 | Government recording | No |
| Points | 1% per point | Upfront interest prepayment | Yes |
Refinancing Benefits
Mortgage refinancing provides significant financial advantages when executed strategically.
Benefits of Refinancing
- Lower Monthly Payments: Reduce monthly housing costs with better rates
- Interest Savings: Save thousands in total interest over loan life
- Shorter Loan Term: Pay off mortgage faster with same or lower payment
- Cash Access: Access home equity for improvements or investments
- Rate Stability: Switch from ARM to fixed-rate for payment predictability
- PMI Removal: Eliminate private mortgage insurance with sufficient equity