Mortgage Refinance Calculator

Net Position — Your total financial advantage (or disadvantage) from refinancing at any point in time. Calculated as: Transition Benefits/Costs + Payment Differential + Balance Differential.

Transition Benefits/Costs — The one-time financial impacts at closing: Cash to Close or Cash Back, Escrow Balancing, and Skipped Payments. A positive number means you come out ahead at closing.

Payment Differential — The cumulative difference in payments made. If you've paid less on the new loan than you would have on the old loan, this is positive.

Balance Differential — The difference in remaining balances (Current Balance − New Balance). If the new loan has a lower balance, this is positive because you owe less.

Break-Even — The payment number when your Net Position first reaches zero. Before this point, you're still "in the red" from refinancing costs.

5-Year Savings — Your net position after 60 payments (5 years). This is a practical milestone that shows whether your refinance is paying off within a typical ownership timeframe. Tap this card to explore how your savings change over time.

Potential Savings — Shows your best potential lifetime savings across three approaches: Apples-to-Apples (equalize payments), Oranges-to-Oranges (equalize payoff dates), and Standard (no extra payments). Tap to compare all three options.

Monthly Savings — The difference between your old total payment (P&I + PMI) and your new total payment. Shown in standard mode when the new payment is lower.

Payments Saved — In Apples-to-Apples mode, the number of payments eliminated by applying your monthly savings as extra principal. If your new payment is higher, this shows how many fewer payments you'd make by paying that higher amount on both loans.

Cash to Close / Cash Back — The total amount shown on your Closing Disclosure. "Cash to Close" means you're bringing money to closing (a cost); "Cash Back" means you're receiving money at closing (a benefit, typically from a cash-out refinance).

Principal Reduction — An optional one-time extra principal payment made with your first payment, typically funded by cash back from the refinance. This reduces your loan balance immediately rather than giving you cash at closing.

Escrow Funding — The initial deposit into your new escrow account, calculated from a 14-month projection to ensure adequate funds for upcoming tax and insurance payments plus the required cushion.

Escrow Balancing — How your old escrow balance impacts the refinance. Shows as "Shortage Financed" (benefit: shortage rolled into loan), "Escrow Refund" (benefit: you get your balance back), or "Overage Applied" (cost: overage reduces payoff but you don't get cash).

Skipped Payments — The mortgage payments you skip between your last old loan payment and your first new loan payment. This cash stays in your pocket and counts as a benefit.

P&I — Principal & Interest. The base mortgage payment that goes toward your loan balance and interest charges.

PMI — Private Mortgage Insurance. Required when equity is below 20%, typically drops off automatically when the balance reaches 78% of the original purchase price (old loan) or current appraised value (new loan).

Apples-to-Apples (A2A) — Equalizes monthly payments between both loan scenarios. If the new payment is lower, the savings go to extra principal on the new loan. If the new payment is higher, that higher amount is paid on both loans, with the difference going to extra principal on the old loan.

Oranges-to-Oranges (O2O) — Equalizes payoff dates by calculating the extra principal needed on the new loan to pay it off when your old loan would have ended. Shows the true monthly cost difference when both loans retire at the same time.