Refinance Savings Calculator
Savings can mean lower payment, less total interest, or both. This framing separates “cash flow now” from “cost of the loan over time” so you do not optimize the wrong metric.
Quick answer
Enter old vs new rate, balance, and term. You will see how monthly P&I and approximate total interest shift—then layer closing costs from your Loan Estimate.
For a related estimate, see 20 Percent Down Calculator.
Explore further: Biweekly Mortgage Calculator · Closing Cost Calculator
How to use this calculator
- Match remaining term or reset: Compare “remaining 27 years” vs new 30-year—resetting term can lower payment but extend interest.
- Log total interest: Look at sum of payments minus principal—not just the first month’s payment drop.
- Subtract closing costs: Net savings should include dollars spent to get the new loan.
What moves the payment
Monthly payment on a fixed-rate amortizing loan is driven by principal, APR, and term. Extra principal reduces balance faster; biweekly schedules effectively add one extra payment per year in many setups. Refinance math adds closing costs and resets amortization—break-even is months of savings versus upfront cost.
Explore further: Debt To Income Calculator · Down Payment Calculator
Real-world example
- Example: 6.875% → 6.125% on $310k, same 27-year payoff goal: Payment might fall ~$120–$150/mo; cumulative interest savings over the life of the loan can reach tens of thousands depending on term—verify in your amortization table (illustrative).
Explore further: Home Affordability With Taxes · Home Loan Calculator
What this means
Years 1–10 on a 30-year loan are interest-heavy: most of your payment is interest, so rate cuts move the needle fast. Resetting term for a lower payment can still raise lifetime interest—compare total interest on the same payoff horizon, not just the first payment.
FAQ
Why did my payment fall but interest paid rise?
Extending term lowers payment but can increase total interest. Compare scenarios with the same payoff horizon.
Is this a loan commitment?
No. Outputs are educational estimates. Final payments, APR, and fees come from your lender’s disclosures.
Why does my amortization schedule differ slightly?
Rounding, day-count conventions, and first-payment timing shift pennies. Use the schedule for directionally correct totals.