Mortgage Refinance Calculator
About This Refinance Calculator
Our mortgage refinance calculator helps you determine if refinancing your home loan makes financial sense. It provides a detailed analysis of your potential savings, including:
- Monthly payment savings comparison
- Break-even point analysis
- Total lifetime savings calculation
- Visual cost comparison over time
- Cash-out refinancing analysis
When to Consider Refinancing
Good Reasons to Refinance
- Interest rates are significantly lower than your current rate
- Your credit score has improved substantially
- You want to switch from an adjustable to a fixed rate
- You need to lower your monthly payments
- You want to pay off your mortgage faster
Consider Carefully If
- You plan to move within a few years
- The interest rate difference is minimal
- You've paid most of your current mortgage
- Closing costs are too high relative to savings
- Your home value has decreased
Understanding the Break-Even Point
The break-even point is when your accumulated monthly savings equal your refinancing costs. Consider these factors:
Closing Costs
- Application fees
- Appraisal fees
- Title search and insurance
- Origination fees
- Points (if applicable)
Monthly Savings
- Lower interest rate
- Shorter or longer term
- PMI elimination
- Rate type changes
Long-Term Impact
- Total interest paid
- Loan term changes
- Equity building
- Tax implications
Cash-Out Refinancing
Cash-out refinancing allows you to borrow more than you owe on your current mortgage. Consider these factors:
- Home Equity Required: Most lenders require you to maintain 20% equity
- Interest Rate Impact: May be slightly higher than standard refinancing
- Use of Funds: Common uses include home improvements, debt consolidation, or education
- Tax Implications: Interest may be tax-deductible if used for home improvements
- Risk Consideration: Increases your mortgage debt and monthly payments
Government Refinance Programs
Several government-backed programs are available to help homeowners refinance their mortgages:
FHA Streamline Refinance
- For existing FHA loans only
- No appraisal required
- Minimal credit check
- Must benefit borrower (lower rate/payment)
- Cannot cash out more than $500
VA Interest Rate Reduction Refinance Loan (IRRRL)
- For existing VA loans only
- No appraisal needed
- No income verification
- Lower funding fee than purchase loans
- Must reduce interest rate in most cases
USDA Streamlined Assist
- For existing USDA loans
- No credit check required
- No appraisal needed
- Must save at least $50 monthly
- No maximum debt-to-income ratio
Special Relief Programs
Fannie Mae High LTV Refinance
- For loans owned by Fannie Mae
- Must have originated on or after October 1, 2017
- Minimum 3% equity required
- Must demonstrate payment benefit
Freddie Mac Enhanced Relief Refinance
- For loans owned by Freddie Mac
- Must have originated on or after October 1, 2017
- Minimum 3% equity required
- Must improve loan terms
Program Eligibility Notes:
- Most programs require you to be current on your mortgage payments
- Some programs have seasoning requirements (minimum time since last refinance)
- Benefits and requirements may vary by state
- Programs may change or expire - check current availability
- Contact your loan servicer to determine which programs you qualify for
Tips for Successful Refinancing
- Check Your Credit Score: Higher scores qualify for better rates
- Shop Multiple Lenders: Compare rates, terms, and closing costs
- Calculate All Costs: Include both upfront and long-term expenses
- Consider Your Timeline: Factor in how long you plan to keep the home
- Understand Rate Types: Choose between fixed and adjustable rates
Important Notes:
- Results are estimates based on the information you provide
- Actual rates and costs may vary by lender
- Consider consulting a mortgage professional
- Tax implications should be discussed with a tax advisor
- Your specific situation may affect refinancing options