Understanding Your Refinance Break-Even
Refinancing is an investment calculation, not just a monthly payment reduction. The Break-Even Point is the critical metric: it tells you how many months it takes for your monthly savings to pay back the closing costs of the new loan.
If you plan to move or sell the property before reaching this break-even point, refinancing may actually cost you money, even with a lower interest rate. Use this engine to verify if the "lower rate" is truly profitable for your specific timeline.
Key Factors
- Closing Costs: The upfront fees to process the loan (appraisal, title, origination).
- Rate Delta: The difference between your current rate and the new rate.
- Loan Term: Resetting to a fresh 30-year term can lower payments but drastically increase total interest paid.