Finance & refinancing scenarios
Loan Refinance Break-Even Calculator
Compare cash payments and remaining debt at the same holding-period checkpoints so a longer loan does not masquerade as a saving.
126 / ENTERED SCENARIO
Inputs stay in this browser.
Your numbers.
A clearer decision.
Inputs stay in this browser.
INPUT GROUP 01
Outstanding principal and current loan
INPUT GROUP 02
Proposed loan and comparison horizon
Check the assumptions before acting on a result.
Read the method and exampleYOUR CALCULATION
Compare payments and remaining debt over the same selected holding period.
Proposed regular payment
Current less proposed cash repayments at horizon
Payment-and-balance-adjusted saving after fee
First nonnegative cost checkpoint within horizon
Equal-horizon debt comparison
| Month | Current repayments | Current balance | Proposed repayments | Proposed balance | Adjusted saving after fee |
|---|---|---|---|---|---|
| 0 | $0.00 | $10,000.00 | $0.00 | $10,000.00 | -$100.00 |
| 1 | $1,000.00 | $9,000.00 | $500.00 | $9,500.00 | -$100.00 |
| 2 | $2,000.00 | $8,000.00 | $1,000.00 | $9,000.00 | -$100.00 |
| 3 | $3,000.00 | $7,000.00 | $1,500.00 | $8,500.00 | -$100.00 |
| 4 | $4,000.00 | $6,000.00 | $2,000.00 | $8,000.00 | -$100.00 |
| 5 | $5,000.00 | $5,000.00 | $2,500.00 | $7,500.00 | -$100.00 |
Illustrative inputs loaded. Replace them with your own assumptions.
How the loan refinance break-even calculator works
Both fixed-rate loans begin at the same outstanding principal. Monthly interest is nominal annual rate ÷ 12, rounded to cents on the prior closing balance. Regular payments are cent-rounded and final payments adjust to retire the loan. The refinance fee is a separate time-zero payment, not additional financed principal.
At each month, adjusted cost is accumulated repayments plus outstanding principal, plus the refinance fee for the proposed option. Current adjusted cost less proposed adjusted cost is the cost saving. Cash released by lower repayments is also shown, but it can be offset by more debt still outstanding. Break-even is the first nonnegative adjusted-cost checkpoint inside the entered horizon; it need not remain positive afterward.
The comparison is undiscounted and assumes each loan is settled at its stated balance at the checkpoint. Taxes, new borrowing, refinance eligibility, non-entered penalties and opportunity cost are excluded. A lower monthly payment alone does not establish a better financing outcome.
Worked example
With 10,000 principal and zero interest, the current ten-month loan pays 1,000 monthly and a proposed twenty-month loan pays 500. After five months, cash repayments are 5,000 versus 2,500, but balances are 5,000 versus 7,500. Both adjusted costs are 10,000 before fees; a 100 refinance fee makes adjusted saving −100. With no fee, it is zero.
Sources and assumptions
The source material explains the underlying calculation or pricing structure. Entered prices, costs, schedules and scenario choices are your assumptions; this tool does not obtain supplier quotes or predict actual results.
Related calculators
Calculation methods, testing and sources · Practical calculation guides