Mortgage refinance calculator

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How to use this calculator

To get the most use out of Bankrate’s mortgage refinance calculator, it helps to have your most recent mortgage statement handy. This will give you the numbers you need to fill in several fields. Once you have the numbers in front of you, follow these steps:

Input your remaining loan balance: This is your monthly principal and interest payment. Don't include taxes or insurance.
Enter your current payment: This is your monthly principal and interest payment. Don't include taxes or insurance.
Enter your property value: This is your home's current estimated market value.
Input your zip code: Helps us pull the most accurate rate offers for your area.
Enter credit score range: Your score affects the rates you qualify for. Use your most recent score from your bank, credit card issuer, or a free credit monitoring service.
Enter your current interest rate: Your score affects the rates you qualify for. Use your most recent score from your bank, credit card issuer, or a free credit monitoring service.
Add the new interest rate: Here, input the rate you’ll get — or the rate you want — with your refinance. If you haven’t shopped around for rates yet, you can check out current mortgage rates from various lenders.
Input your new loan term: A shorter term comes with higher monthly costs (because you’re paying it back over less time) but bigger savings over the life of the loan.

Understanding your results

Once you've entered your details, the results panel updates in real time.

Estimated lifetime savings: The total interest you'd save over the life of your new loan compared to your current one, expressed as a monthly figure.
New payment: Your estimated monthly principal and interest payment at the new rate and term.
Break-even point: How long it takes for your monthly savings to offset what you paid in closing costs. If you plan to stay in your home past this point, refinancing likely makes financial sense.

How mortgage rates can impact your decision

Mortgage rates are central to determining whether a refinance will save you money. Generally, you want your new rate to be at least 0.5% lower to be worth your while. But that figure might be higher depending on your loan balance, term and how long you plan to stay in your home.

Timing your refinance application can be tricky, as rates change constantly. For example, the average 30-year fixed mortgage rate hit 7.19% in January 2025, only to drop to 6.18% by January 2026. That’s a major difference when it comes to refinancing.

Keep these fluctuations in mind as you’re beginning to plan. If it doesn't make sense to refinance under the current market conditions, wait while continuing to track the rates. And if you stand to gain significant savings with today’s rates, act fast.

What is mortgage refinancing?

Mortgage refinancing (a “refi” for short) means you replace your current home loan with a new one. The borrowed funds from your new mortgage pay off your existing loan. Most people refinance to lock in a lower interest rate or to shorten the mortgage term. Some refis also let you borrow an additional amount in cash.

Factors that affect your mortgage refinance

You need to qualify for a refinance much the way you did for your original mortgage. The terms you’ll receive depend on several factors, including:

Credit score: Most lenders like to see a minimum of 620, but higher is better.
Debt-to-income ratio: Generally, lenders like to see 43% or less of your gross monthly income go toward debt payments, including your mortgage. A higher ratio may be permitted if you have a lot of savings or other compensating factors.
Solid payment history: If you have recently been late on or missed mortgage payments, it may be difficult to qualify for a refinance.
Loan-to-value ratio: Typically, lenders want you to have at least 20% equity in your home to refinance your mortgage.

You'll also need to prove that you have sufficient income to afford the new payments and provide similar financial documentation to that you supplied when securing your existing mortgage.

What to consider next

Is now the right time to refinance your mortgage? The answer might be no — especially if current rates are not significantly lower than the rate you already have — and that’s OK. Refinancing costs a fair amount of money upfront, and if it’s not worth your while right now, then it’s smarter to wait.

But if you’ve reviewed the numbers and decided that refinancing makes sense, then it’s time to shop around for a refinance lender. Check with your current mortgage servicer, as well as national banks, credit unions, online mortgage lenders and possibly a mortgage broker to compare refinance rates and terms.

When you narrow it down to a few lenders you’re interested in, apply for preapproval. Lenders will send you a loan estimate that breaks down your new loan details, including the interest rate and all fees. Loan estimates are great tools for comparison shopping, as you'll get the clearest picture of which lender will help you meet your refinance goals.