Compare your current loan with a refinance and find the break-even point. Free, private, and runs entirely in your browser.
Both payments are computed with the amortization formula. Break-even is closing costs divided by the monthly savings.
When does refinancing make sense? When you will stay in the home past the break-even point and the new rate is meaningfully lower.
Why can total interest rise? A longer new term can lower the payment but add interest over the life of the loan.
Refinancing a $250,000 balance from 7% (27 years left) to 6% over 30 years with $4,000 in closing costs lowers the payment from about $1,720 to about $1,499, saving roughly $221 per month. Break-even arrives in about 19 months. Total interest including costs is lower by about $13,500 in this case, even though the term is longer.
How low must rates fall to refinance? There is no fixed rule; what matters is whether savings repay your costs before you sell or move.
Do closing costs have to be paid upfront? Some lenders let you roll them into the loan, which raises the balance.