Break-Even Calculator
How long until refinancing pays for itself? The break-even point is your key number.
Break-Even Point
19 months
About 1.6 years
💡 Plain English: Refinancing costs $5,000 upfront but saves $264.79/month. After 19 months (1.6 years), you've recouped the costs — everything after that is pure savings. Plan to stay in the home past the break-even point for it to make sense.
About the Refinance Break-Even Calculator
The break-even point is the moment when your monthly savings from refinancing fully cover the cost of refinancing. It is the single most important number for deciding whether a refinance is worth it.
How this calculator works
Enter your closing costs and expected monthly savings from the new lower payment. The calculator divides costs by savings to show how many months you must keep the loan for the refinance to pay off.
The math, in plain English
Break-even (months) = total refinance closing costs ÷ monthly savings. If you expect to move or sell before that many months, refinancing usually does not pay off.
Key terms
- •Break-even point — the time needed for savings to equal refinance costs
- •Closing costs — the fees paid to complete the refinance
- •Monthly savings — the reduction in your payment after refinancing
Tips & things to know
- ✓Only refinance if you expect to stay past the break-even point.
- ✓A "no-cost" refinance usually trades closing costs for a higher rate — run both scenarios.
- ✓Compare break-even against how long you realistically plan to own the home.
Frequently asked questions
What is a good break-even point?+
Generally, a break-even under 24–36 months is considered strong, but it depends on how long you plan to keep the home.
Does a lower payment always mean I should refinance?+
Not if the closing costs are high and you move before the break-even point — you could lose money overall.
This calculator is for educational purposes only and uses estimates. Always consult a licensed mortgage professional for advice specific to your situation.