Refinance Calculator for Mortgage Payment Savings

A refinance quote is easy to misread if you only look at the rate. The refinance calculator rebuilds the new amortizing payment on today’s balance, subtracts it from the payment you actually make, and shows how long closing costs take to earn back. It also totals scheduled payments on the new loan plus closing costs so a 30-year reset is not mistaken for a free lunch. Stretching remaining term can cut the monthly bill while raising lifetime interest. The new payment uses M = P × r × (1 + r)^n / ((1 + r)^n − 1) with P equal to the current mortgage balance, r the new annual rate divided by 12, and n the new term in months. Monthly savings = current monthly payment − new payment. Break-even months = closing costs / monthly savings when savings are positive. New total scheduled payments = new payment × new term × 12 + closing costs. The current interest rate and remaining term are collected for context and scenario notes; savings are measured against the payment you enter, which already includes any extra principal you send today. Use the comparison when a lender offers a lower rate, when you want to drop PMI after a rate-and-term refinance, or when you are tempted to refinance into a longer term for cash flow. If the new payment is higher, the result reports no payment-based break-even. That can still be rational for a shorter term, but it is not a monthly-savings refinance. The totals omit taxes, insurance, HOA dues, and the old loan’s remaining interest. They also omit prepayment. If you will sell within the break-even window, the cash-flow case is usually weak. Read the Loan Estimate, confirm whether costs are financed, and review the decision with a lender or adviser before you lock a rate.