Mortgage Refinance Savings Calculator
Compare current rates and refinance alternatives. Find out how much you save by refinancing and combining it with extra payments to maximize speed.
Loan Details
Accelerated Savings
Redirecting your saved monthly payments ($0/mo) for the 0 years you saved at a 7% annual return accumulates this wealth.
Optimize Your Refinancing Strategy
Our Mortgage Refinance Calculator is built for homeowners looking to lower their interest rate or restructure their home loans. By entering your new terms and simulating extra payments on the new loan, you can evaluate the break-even point and maximize your interest savings.
The Math of Refinance Savings
Refinancing involves replacing your existing mortgage with a new loan. Interest on the new loan is calculated monthly on the remaining balance using standard amortization formulas:
A lower rate decreases your monthly interest payment. If you reinvest those monthly savings as extra principal prepayments on the new loan, you compound your savings and dramatically shorten your payoff timeline. For guidelines on refinancing, check the consumer guides on the Consumer Financial Protection Bureau (CFPB) website.
Worked Numerical Example
Consider a refinanced loan of $300,000 at a new interest rate of 5.5% (down from 6.5%) over a 30-year term, with an extra payment of $200/month:
- New Loan Balance: $300,000
- New Interest Rate: 5.5% (APR)
- Term: 30 Years (360 Months)
- Standard Monthly Payment: $1,703.37
- Extra Monthly Payment: $200.00
| Payoff Scenario | Monthly payment | Total Interest Paid | Total Cost of Loan | Payoff Timeline |
|---|---|---|---|---|
| Standard Schedule | $1,703.37 | $313,212.12 | $613,212.12 | 30.0 Years |
| Accelerated Prepayment | $1,903.37 | $231,122.12 | $531,122.12 | 24.3 Years |
| Total Savings | +$200.00 / month | $82,090.00 Saved | $82,090.00 Saved | 5.7 Years Shaved Off |
When to Use This vs. Our Other Calculators
To select the most appropriate calculator for your planning:
- Use the Mortgage Calculator to model standard mortgages with extra payment schedules.
- Use the Mortgage Payoff Calculator to calculate exact mortgage payoff dates.
- Use the Amortization Schedule Calculator to view your full month-by-month balance reduction breakdown.