Refinance Break-Even Calculator
Calculate exact months until refinance savings recover closing costs. Standard rule: break-even should be under 24 months for short-hold borrowers.
| Current Payment | — |
| New Payment | — |
| Monthly Saving | — |
| Closing Costs | — |
| Break-Even Months | — |
| Net Saving Over Remaining Term | — |
Calculate exact months until refinance savings recover closing costs. Standard rule: break-even should be under 24 months for short-hold borrowers. Cite official methodology in your communications — sources linked below.
How the Calculation Works
Break-even = Closing Costs ÷ Monthly Savings. Standard refinance is worthwhile when break-even is under 24-30 months and you plan to stay longer than that. Below 12-18 months is excellent; above 60 months indicates closing costs eat most of the savings.
Benchmarks and Use Cases
CFPB and lenders agree: refinance with 0.5%+ rate drop and 18-24 month break-even is "always worth running". Above 1% rate drop, refinance is almost always a winning move. Below 0.25% drop, closing costs usually exceed savings — skip.
Common Mistakes and Limitations
Common mistakes: (1) Ignoring rolled-in closing costs (interest accrues for full term). (2) Comparing 30-year to 30-year only — switching to 15-year compresses payments and saves more in lifetime interest. (3) Not factoring opportunity cost of cash used for closing.
Last updated May 2026. Sources: CFPB Mortgage, Fannie Mae.