Refinance Interest Savings

Exactly what do you save in interest if you refinance your home mortgage? Use this calculator to find out! Simply enter the details of you current mortgage, along with your present appraised value, new loan term, rate and closing costs. The calculator does the rest! It will also calculate how many months until you break even on closing costs, using your lowered monthly payments as a basis. Click the "View Report" button to view the results.

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Definitions

Appraised home value
Your home's present market value.

Original loan amount
The total of your first mortgage.

Original rate
The annual percentage rate (APR) of your first mortgage.

Original term in years
This is the entire number of years covering your first mortgage.

Number of payments made
This is the entire amount of payments made on your first mortgage.

Annual property taxes
The total amount you pay in property tax each year.

Annual home insurance
This is the amount of homeowner's insurance you pay each year.

Monthly PMI
This is how much you pay for Principal Mortgage Insurance (PMI) each month. It's commonly figured between 0.5% and 2% of your annual loan payment amount, provided you have less than 20% equity (free-and-clear ownership) in your home.

Current PITI
Simply the current amount of Principal, Interest, Taxes and Insurance you pay each month.

New rate
This is your new mortgage's effective (actual) annual percentage rate.

New term
This is simply the lifespan of your new mortgage.

New mortgage balance
Refers to the total amount of your newly refinanced mortgage. The amount is the same as the current balance on your first mortgage. All closing costs and prepayment penalties are expected to be paid at closing. These costs are not added to the balance of your new mortgage.

Closing costs
Paid at closing, these are the fees and other costs relating to your new mortgage. This calculator requires all closing costs to be paid with monies from sources other than your new mortgage (closing costs are not figured into your new mortgage amount).

New PITI
Refers to the new monthly Principal, Interest, Taxes and Insurance (PITI) payment amount.

New loan to value
This number is calculated by dividing your loan total by the appraised home value. For example, if your loan amount is $50,000, and your home is appraised at $100,000, then your New-Loan-to-Value is 50%.