See how much you could save by refinancing your mortgage. Include penalty costs and calculate your break-even point.
Monthly Savings
See your payment reduction
Break-Even Analysis
When savings exceed costs
Net Savings
After penalty costs
Use our Penalty Calculator to estimate this amount
Current Payment
$2,894
New Payment
$2,249
$645
5-Year Term Comparison
Current
Total Interest
$98,432
New
$85,210
Principal Paid
$74,912
$49,680
Break-Even Point
When savings exceed penalty
12 months
*Estimates only. Actual savings may vary based on your situation.
Refinancing can save you thousands of dollars, but it's not always the right choice. Here's how to know if refinancing makes sense for your situation.
The break-even point tells you how long it takes for your monthly savings to exceed the costs of refinancing (penalties, legal fees, appraisal). If you plan to stay in your home longer than the break-even period, refinancing likely makes financial sense.
Break-Even Formula: Total Costs ÷ Monthly Savings = Months to Break Even
Example: $8,000 penalty ÷ $645/month savings = 12.4 months
One of the most powerful uses of refinancing is consolidating high-interest debt. Credit cards charging 19-24% and lines of credit at 7-10% can be rolled into your mortgage at 4-5%, dramatically reducing your overall interest costs.
However, be cautious: while your monthly payments will decrease, you're spreading that debt over a longer period. The total interest paid over time could actually be higher if you don't make extra payments.
Get a personalized refinance quote and see how much you could save.
Refinancing makes sense when you can save more in interest over your remaining term than the cost to break your current mortgage (prepayment penalty + legal fees + appraisal). A common rule of thumb: if you can lower your rate by 0.50% or more, it's worth exploring.
The penalty for breaking a fixed-rate mortgage is the greater of 3 months' interest or the Interest Rate Differential (IRD). IRD can be substantial — sometimes $10,000-$30,000+. Variable-rate penalties are always 3 months' interest, which is significantly less. Use our Penalty Calculator for an estimate.
Yes. If you have at least 20% equity in your home, you can refinance up to 80% of your property's value and use the extra funds to pay off high-interest debts like credit cards (19-24%), personal loans, or car loans. This can save thousands per year in interest.
You need at least 20% equity in your home to refinance. For example, if your home is worth $600,000, you can refinance up to a maximum of $480,000 (80% LTV). If your current mortgage balance is $400,000, you could access up to $80,000 in equity.
Typical refinancing costs include: prepayment penalty (varies), legal fees ($800-$1,500), appraisal fee ($300-$500), discharge fee ($200-$350), and title insurance ($200-$400). Total costs usually range from $2,000 to $5,000+ depending on your penalty.
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