Compare the math
Refinance payment and break-even
Current principal and interest
$2,120.34/month
Proposed principal and interest
$1,932.90/month
- Monthly difference
- $187.44 lower
- Simple break-even
- 33 months
- Full-term cost difference
- $50,232.00 lower
This fixed-rate illustration excludes taxes, insurance, mortgage insurance, points, prepaid interest, cash-out amounts, and changes in loan balance. Compare official Loan Estimates—not advertised rates alone.
What “break-even” means here
The simple break-even month divides entered closing costs by monthly principal-and-interest savings. It does not include opportunity cost, taxes, insurance, mortgage insurance, cash-out proceeds, points, or tax effects.
Why the term matters
Restarting with a new 30-year loan can lower the monthly payment while extending the repayment period. Compare the full entered terms as well as the monthly difference. A shorter term may increase the payment even when the rate falls.
How to shop for a less expensive mortgage
- Request Loan Estimates for the same loan amount, type, and term.
- Compare rate, APR, points, origination charges, and lender credits.
- Compare mortgage insurance and the five-year cost shown on the form.
- Ask whether the rate is locked and for how long.
- Check for a prepayment penalty on the current or proposed loan.
- Do not treat lower tax or insurance estimates as lender savings.