Calculators · Buying & Financing

Refinance and Cash-Out Calculator

Compare your current mortgage with a refinance or cash-out refinance: new payment, break-even month, loan-to-value and total cost over the years you expect to keep the loan.

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How this calculator works

A lower rate does not always mean a better deal. Closing costs, a longer term and cash taken out all change the math. This calculator compares the two loans over the years you actually expect to keep the new one, counting payments, cash costs and the balance left at that point.

For a cash-out refinance, the new loan pays off the current balance plus the cash you take. Lenders cap the new loan at a percentage of the home's value.

Break-even = closing costs paid in cash ÷ monthly payment savings.
Cost over your horizon = payments made + cash costs + balance still owed − cash out, for each option.
If you add the closing costs to the loan, there is no cash break-even, but you pay interest on those costs.

Worked example

Example values are illustrative, not quotes or market data. These are the numbers the calculator above starts with.

Inputs

Current rate: 7.25%
Years left: 27
Estimated home value: $400,000
New rate: 6.25%
New loan length: 30 years
Cash out: $0
Closing costs: $5,000
Add closing costs to the new loan: No
How long you expect to keep the loan: 7

Results

New loan: $280,000
New payment: $1,724
Monthly change: $248
Break-even (months): 21
Cost over horizon (refinance): $401,911
Cost over horizon (keep): $415,095

Common questions

How much can I take out in a cash-out refinance?

It depends on the program and lender. Many conventional cash-out loans are limited to 80% of the home's value. Texas homestead cash-out loans (Section 50(a)(6)) are limited to 80% loan-to-value and have other rules, such as a 12-day waiting period after disclosure.

Does refinancing restart my loan?

A new 30-year loan starts a new 30-year schedule. You can choose a shorter term or keep paying extra to avoid stretching the payoff.

What closing costs should I expect?

Use the lender's Loan Estimate. The example amount is illustrative.

Related calculators

Estimate only. Actual loan terms, eligibility, insurance, taxes, and settlement charges require verification. These are planning estimates, not a lender Loan Estimate, Closing Disclosure, appraisal, or approval. Michael O'Neal is a real estate broker, not a lender, appraiser, attorney or tax adviser.

Next step

Want a real financing quote? Connect with Home Front Mortgage.

Andrew Fairleigh, Mortgage Loan Originator, Home Front Mortgage, NMLS #1878546. (979) 595-8979 · [email protected]

Start Your Application Andrew's profile

Rates in these calculators are examples, not Home Front quotes. Your application goes to Home Front's secure site. Do not send financial documents through this website.

Affiliated business arrangement disclosure. This is to give you notice that some agents and owners at Keller Williams Realty Northeast, including Michael O'Neal, have a business relationship with certain providers of services related to your purchase, sale or refinance of real estate, including Home Front Mortgage and Keystone Title & Escrow. Because of this relationship, a referral may provide some owners and agents at Keller Williams Realty Northeast a financial or other benefit. You are NOT required to use either company as a condition for your purchase, your financing or refinance, or any other transaction related to a property. There are frequently other providers available with similar services. You are free to shop around to determine that you are receiving the best services and the best rate for these services. You will be given the written Affiliated Business Arrangement Disclosure, including estimated charges, to review and sign.