Refinance Calculator

Mortgage refinancing involves replacing your current mortgage with a new loan, typically to secure better terms such as a lower interest rate, different loan term, or to access home equity.

Key Considerations:

• Interest Rate: A lower rate can significantly reduce monthly payments and total interest paid
• Loan Term: Shorter terms mean higher payments but less total interest; longer terms reduce payments but increase total cost
• Closing Costs: Typically 2-5% of loan amount; factor these into your break-even analysis
• Break-even Point: Time needed to recoup closing costs through monthly savings
• Credit Score: Better scores qualify for lower rates

When to Consider Refinancing:

• Interest rates have dropped significantly since your original loan
• Your credit score has improved substantially
• You want to switch from adjustable to fixed rate (or vice versa)
• You need to access home equity for major expenses
• You want to remove PMI (private mortgage insurance)