Refinance Calculator

Use our free Refinance Calculator to quickly estimate new monthly payments and potential savings, based on key inputs like current loan balance, new interest rate, and loan term. Perfect for homeowners and borrowers.

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Refinance Formula

Monthly Payment (Principal & Interest) = P × [ r(1 + r)^n ÷ ((1 + r)^n − 1) ] Where: P = principal (loan amount) r = monthly interest rate (annual rate ÷ 12) n = number of months in the loan term Savings = Current Monthly Payment − New Monthly Payment Break-even Point (months) = Closing Costs ÷ Monthly Savings
Example:
Current loan: $250,000 at 6% for 30 years = $1,499/mo Refinance loan: $250,000 at 5% for 30 years = $1,342/mo Savings = $1,499 − $1,342 = $157/mo If closing costs are $3,000 → Break-even = 3,000 ÷ 157 ≈ 19 months

A refinance calculator shows whether refinancing lowers your monthly payment and how long it takes to recoup closing costs.

How this refinance calculator works

This calculator compares your current mortgage with a new loan scenario, factoring in interest rate, term, and closing costs. It shows new monthly payments, savings, and break-even time so you can decide if refinancing makes financial sense.

When to use this refinance calculator

When mortgage rates drop and you're considering refinancing

To calculate monthly savings before switching loans

To compare loan terms (e.g., 30 years vs. 15 years)

When factoring in closing costs for ROI analysis

For financial advisors preparing loan recommendations

Want to make your refinancing smarter?

Use ServiceAgent.ai to automate estimates, manage proposals, and track profitability—all from one dashboard.

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Average Profit Margins by Industry

Understand how mortgage refinancing compares to other service industries. Below are typical profit margin ranges:

Mortgage Lenders

15–25%
net margin

Banks & Financial Institutions

20–30%
net margin

Real Estate Agents/Brokerages

15–30%
net margin

Roofing Contractors

20–40%
net margin

HVAC Contractors

10–20%
net margin

Plumbing Contractors

20–35%
net margin

Electrical Contractors

15–25%
net margin

Construction/Contracting

15–30%
net margin

These benchmarks help borrowers and advisors evaluate competitiveness and profitability.

Frequently Asked Questions

It uses the amortization formula to give a reliable estimate. Actual results may vary with fees, taxes, and PMI.

Interest rate reduction, loan balance, loan term, and closing costs.

Yes—enter the loan balance, new rate, and term.

Yes—it divides closing costs by monthly savings to show when refinancing pays off.

No—the calculator shows principal and interest only. Add escrow separately.

Not always—if you reset to a longer loan term, you might pay more in total interest.

If you'll sell before reaching the break-even point, refinancing may not be worth it.

Pair it with ServiceAgent.ai to create automated refinancing proposals and client reports.

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