Should I refinance? The honest math.
Most refi calculators tell you the monthly savings and stop there. That's the wrong question. The right question is: how long until savings exceed closing costs? Below that break-even point, you lose money. This calculator shows you both: monthly delta AND break-even month. Buying instead? Try the Mortgage Calculator.
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Break-even analysis
Three rules. Two of three must hit.
Refinancing isn't free — closing costs run 2–3% of loan amount. Before clicking "apply," verify these three conditions.
Five expensive mistakes buyers don't notice.
The math looks obvious until you account for these. Each one routinely turns a "good refi" into a net loss. For a deeper dive, read When a Refi Actually Pays.
Refinance questions, answered honestly.
Eight questions homeowners ask before refinancing. Real answers, including the math nobody else shows you.
Rule of thumb: at least 0.75 percentage points below your current rate. Below that, closing costs typically eat the savings before break-even.
Exceptions: very large loans (over $750K) where even a 0.5% drop creates meaningful monthly delta, or moving from FHA to Conventional to escape permanent MIP.
Depends on your current rate. If your existing first-mortgage rate is below market, don't refinance — use a HELOC and keep your low rate intact on the larger first-mortgage balance.
If your current rate is at or above market, cash-out refinance can lower your blended rate AND fund the project. See Cash-Out Refinance for the side-by-side math.
Rate-and-term refinance: Replaces existing mortgage with a new one at a different rate, term, or both — no cash out at closing. Lowest rates, simplest underwriting. See Rate-and-Term Refinance.
Cash-out refinance: New mortgage exceeds the current balance, with the difference paid to you in cash at closing. Higher rate (typically 0.25–0.50% more) and stricter LTV/credit requirements. See Cash-Out Refinance.
Match your remaining term, or shorten it. If you have 22 years left on your current 30-year loan, refinancing into a 22-year saves you the years of additional interest you'd incur on a fresh 30-year.
Going shorter (15-yr or 20-yr) can save tens of thousands in interest, often with a lower rate too. Trade-off: higher monthly payment. Run the math on the calculator above with different new-term selections, or use the Payment Comparison tool.
Conventional refinance: 620 minimum, 740+ for best rates. FHA Streamline Refinance: can refinance with FICO as low as 580 (some lenders no minimum) since it's a simplified process. VA IRRRL: typically no FICO minimum — payment-history-based.
If your score has dropped since original purchase, FHA Streamline (if you're currently FHA) or VA IRRRL (if you're currently VA) may still work even when conventional refi is closed off.
30–45 days typical for full underwriting refinance (rate-and-term or cash-out). FHA Streamline and VA IRRRL can close in 20–30 days due to simplified documentation.
Lock your rate at application — rate locks typically run 45–60 days, enough to cover the close. Floating the rate is gambling; locking is insurance.
2–3% of loan amount for full refinance. On a $400K loan, that's $8,000–$12,000. Includes lender fees, title insurance, escrow setup, appraisal, recording, and prepaid property tax/insurance reserves.
FHA Streamline and VA IRRRL closing costs are typically lower — in the $3,000–$6,000 range — because they skip the appraisal and full underwriting steps. For deeper context, see When a Refi Actually Pays.
Yes — this is one of the most common reasons for refinancing. The remaining spouse refinances the existing loan into their name only, removing the ex from the obligation. Note: the remaining borrower must qualify on their income/credit alone.
If the remaining borrower doesn't qualify on their own, alternatives include: keeping the loan with both names (legal complications), selling the home, or having a third party assume the loan (rare). Talk to a divorce-experienced LO before signing the property settlement agreement.
Get a refi quote based on your file.
Sixty-second short app — no SSN, no hard credit pull. We'll come back with your real refi rate, true break-even math, and whether you should rate-and-term, cash-out, or stand pat. Sometimes the right answer is don't refinance. We'll tell you that.