Mortgage Refinance Calculator

Refinance Calculator: Save on your monthly payment

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Written by Denny Ceizyk | Edited by Kurt Adams | Updated June 30, 2023

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The LendingTree refinance calculator helps you determine if it’s worth it to replace your current loan with a new one. It costs money to refinance a home, and with a few inputs you the refinance calculator shows you if the benefit is worth the cost.

How to use a mortgage refinance calculator

You’ll need to have some information about your current mortgage handy to get the best refinance calculator results. You’ll also need to add information about the new mortgage you’d like to apply for.

Your current mortgage information

Original amount: Start by entering how much you originally borrowed on the loan you’re refinancing.
Loan Start Date: Next add the date your current loan started. This information should be on your monthly mortgage statement.
Loan term: You can choose a 30- or 15-year term.
Interest rate. Enter your current interest rate (also on your current mortgage statement)

Your new mortgage information

Loan term: Choose between a 30- or 15-year term.
Interest rate: Add the interest rate you’d like. Check current refinance rates for more precise numbers.
Lender & Title Fees: Our calculator automatically assumes refinance closing costs equal to 2% of your new loan amount — actual costs may range between 2% and 6% of your loan amount.
Length of Ownership: Make sure you enter how long you plan to live in your if it’s more than five years — if you don’t, your refinance breakeven point won’t be accurate.

Understanding the refinance calculator break-even point

Your refinance break-even point is how long it takes to recoup the closing costs you incur on your refinance. For example, if you can save $200 per month by refinancing, but pay $6,000 in costs to get the savings, your break-even point is 30 months ($6,000/$200 = 30 months). If you stay in the home at least 30 months, you’ll save money by refinancing. If not, skip the refinance.

Our refinance calculator will provide two recommendations based on the breakeven point results:

Refinance makes sense. You’ll breakeven before you plan on moving. This means the refinance is worth it.
Refinancing makes sense if you plan to stay for more than “x” years. You’ll not break even before you plan on moving. I’ts best to skip your refinance plans for now with this warning. The “X” will feature a number that tells you how long you need to stay in your home.

What is a mortgage refinance?

A refinance is a process that involves paying off your current mortgage and replacing it with a new home loan. The most common reason to refinance your mortgage is to lower your interest to reduce your monthly payment.

Learn more about refinance mortgage requirements

Should I refinance?

A refinance makes the most sense if:

You can lower your interest rate. Beside saving on your monthly payment, a lower rate can save you thousands of dollars in interest charges over the life of your loan.
You want to pay your loan off faster. If you can swing the higher payment, switching from a 30-year to a 15-year mortgage means you’ll be mortgage free much faster.
You’re nervous your adjustable-rate mortgage payment is going up. If the teaser rate on your adjustable-rate mortgage (ARM) rate is headed north, refinancing to a fixed-rate may give you peace of mind.
You want to tap some equity to pay off debt or improve your home. Convert some home equity to cash with a cash-out refinance and pay off credit card balances or spruce up your home.

When can I refinance?

If you just closed on your home at a high interest rate, you’re probably wondering how soon you can refinance your mortgage. If you have a conventional loan, you can refi as soon as it makes financial sense. You’ll need to wait up to a year before you can refinance a government-back loan.

Summary of the best refinance lenders of 2023

LendingTree rating and “best of” category	Minimum credit score	Lender review
Best overall refinance lender	Not disclosed	Read our review
Best for variety of refinance products	580 to 620	Read our review
Best for rate transparency	620	Read our review
Best online mortgage experience for a traditional bank	Not disclosed	Read our review

What are some alternatives to a refinance?

If the break-even point doesn’t quite make sense for a refinance, consider one of these alternatives.

• Recast your loan. If you’re about to receive large lump sum of cash from a bonus or the sale of another property, your current lender may allow you recast your mortgage. Your new loan amount — and monthly payment — are based on how much cash you pay toward the balance. You can skip all the closing costs and paperwork, although the lender may charge a small fee to complete the process.

• Biweekly payment. If the payment shock on a 15-year mortgage is too much for your budget, try paying your mortgage every two weeks. Most lenders offer the option to set up biweekly payments, which shaves interest charges and a few years off your mortgage.

• Ask your lender to remove PMI. You may be able to get rid of your monthly private mortgage insurance charges if you have 20% equity in your home from value increases in your neighborhood. Call your lender and ask them about the process — for the cost of an appraisal you may be able to permanently drop your monthly PMI cost.

About the Author

Denny Ceizyk has been a senior writer covering LendingTree’s mortgage content since 2019; he has covered the mortgage industry since 2007. Besides writing home loan articles for LendingTree, Denny contributes expert commentary for national publications including MarketWatch, the New York Post, AARP, Realtor.com and Money magazine.

Frequently asked questions

You may be tempted to just ignore the “Length of Ownership” field in your calculations and leave it pre-set to five years. However, before you spend thousands of dollars on closing costs, get your home appraisal and provide all the documentation you typically need to refinance, make sure you’ve given some thought to how much longer you’ll be in the home.

Is it time to get a bigger home to support your growing family? Maybe it’s time to downsize your home now that the kids have flown the coop. Or it could be time to ditch city living for a home in the country. Pondering these questions before you refinance could save you time and money on something that won’t benefit you financially.

Conventional refinance loans. Fannie Mae and Freddie Mac set the guidelines for the most popular loan type: conventional loans. You can avoid mortgage insurance with 20% equity in your home.

FHA refinance loans. Homeowners with scores as low as 500 may qualify to refinance with an FHA loan. However, you’ll pay FHA mortgage insurance regardless of your equity amount.

VA refinance loans. Eligible military borrowers may be able to borrow up to 100% of their home’s value with a VA rate-and-term refinance. VA borrowers can borrow 90% of their home’s worth with a VA cash-out refinance.

USDA refinance loans. Borrowers in rural areas with current USDA loans can lower their payment, but don’t have a cash-out option.

The answer is simple: shop around. LendingTree studies show that consumers who shop for a mortgage save thousands of dollars in interest charges. Mortgage interest rate forecasts change frequently, which means rates may change their pricing strategies daily. Shopping gives you the best chance of catching a special deal or moving on from a lender that’s not competitive.

Some big news about rates in 2023: The Federal Housing Finance Agency (FHFA) announced pricing adjustment changes for a number of factors. Most of the changes go into effect on May 1, and they could have an impact on the conventional mortgage refinance rate you’re offered. To learn more, visit our Mortgage Refinance Rates page.

Unless you’re eligible for a streamline refinance program like the FHA streamline or VA interest rate reduction refinance loan (IRRRL) the following steps best describe how to refinance a mortgage:

Pick your financial goal and loan program. This is important because any changes (like switching from a rate-and-term refinance to a cash-out refinance) could add extra hoops — and costs — to your refinance loan. The same is true for loan programs — choose a government-backed refinance loan if you need to refinance with bad credit, or a conventional loan if you have a high credit score and more than 20% equity in your home.
Shop for a lender and lock your rate. Once you’ve reviewed loan estimates and chosen the best lender for your needs, ask your lender for a mortgage rate lock. Mortgage rates change daily and your rate isn’t guaranteed until it’s locked in.
Gather your paperwork and get your home appraised. In most cases, you’ll need to provide current paysubs, W-2s and bank statements. You’ll also need information about the loan you’re paying off. Finally, spruce up your home for the home appraisal, unless you’re eligible for an appraisal waiver.
Finalize your closing disclosure and enjoy your savings. Once your loan is approved, you’ll receive a closing disclosure three business days before you sign. Review it and make sure the numbers are correct. If they are, sign your papers and you’re all done.