Mortgage Refinance Calculator

Live rates · USA · May 3, 2026
Source: Freddie Mac · updated weekly
Income
Annual gross income
$/yr
Co-borrower income
$/yr
Monthly debts
Car, student, credit card
$/mo
Mortgage
Down payment
$
Interest rate
%
Amortization
Housing costs
Property tax rate
%/yr
Monthly HOA / condo fee
$/mo
Max home price
—
based on qualifying ratios
Monthly payment
—
on max purchase price
Qualifying ratios
Front-end ratio
Max 28%
—
Back-end ratio
Max 36%
—
Monthly budget breakdown
Enter your income above to calculate your maximum home price.
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Home price
$
Down payment
$
20.0% of price
Annual interest rate
%
Amortization
Payment frequency
Extra monthly payment
$/mo
Monthly payment
—
Loan amount
—
Total interest
—
Total cost
—
Payment breakdown
Principal—
Interest—
Balance & cumulative interest
Balance
Cum. interest
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Current loan
Remaining balance
$
Current rate
%
Remaining term
yrs
New loan
New rate
%
New term
Closing costs
$
Current loan
—
per month
Remaining interest: — Total remaining: —
After refinancing
—
per month
Total interest: — Total + closing: —
Cumulative interest paid (+ closing costs on new loan)
Current loan
New loan
Buying
Home price
$
Down payment
$
20.0% of price
Mortgage rate
%
Amortization
Property tax rate
%/yr
Maintenance + insurance
%/yr
Renting
Monthly rent
$/mo
Annual rent increase
%/yr
Returns & horizon
Home appreciation
%/yr
Renter investment return
%/yr
Analysis period
Monthly housing cost
Owning
—
Renting
—
Net worth at 20 years
Buying
—
Home equity + invested savings
Renting + investing
—
Down pmt + invested savings
Net worth over time
Buying
Renting + investing
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About the Mortgage Refinance Calculator

Refinancing replaces your current mortgage with a new one at a different rate, a different term, or both. The central question is always the same: how many months does it take for your monthly savings to recover the cost of breaking your current mortgage and setting up the new one?

The break-even calculation is straightforward: total refinancing cost divided by monthly payment reduction. If you save $300 per month and total costs are $6,000, you break even in 20 months. If you plan to stay in the home for 5 years after refinancing, you come out ahead by approximately $12,000 over that period. The lifetime interest comparison extends this analysis over the full remaining terms of both loans.

Canadian borrowers face a unique consideration: the Interest Rate Differential (IRD) penalty. When you break a fixed-rate mortgage before the term ends, your lender charges the greater of three months' interest or the IRD — the interest your lender loses by releasing you from your higher rate early, calculated over the remaining term on your outstanding balance. In a falling-rate environment, IRD penalties can easily exceed $10,000–$20,000.

Variable-rate mortgages in Canada typically carry only a three-month interest penalty to break, which is considerably lower than fixed-rate IRD penalties and often makes refinancing more favourable. Always get a formal penalty quote from your lender before making a decision.

Key terms

Frequently asked questions

When does refinancing make financial sense?
Refinancing makes sense when three conditions align: (1) the new rate is meaningfully lower — at least 0.5% to 1.0% below your current rate; (2) your break-even period is shorter than your planned remaining time in the home; and (3) you have enough home equity to qualify for the new mortgage. A general rule: if your break-even is under 24 months and you plan to stay at least 5 years, refinancing is worth exploring.
How is the IRD penalty calculated in Canada?
The IRD = (your contracted rate − lender's current posted rate for your remaining term) × outstanding balance × remaining months ÷ 12. For example: $400,000 remaining at 5.5% with 24 months left, current 2-year rate of 4.5% → IRD = 1.0% × $400,000 × 2 = $8,000. In practice, lenders may use posted rates rather than discounted rates, which can inflate the penalty. Always request a formal penalty statement from your lender.
Should I refinance at mortgage renewal in Canada or shop around?
At renewal, you are not breaking your mortgage early — there is no IRD penalty. This is the optimal time to refinance with a new lender. Research shows Canadians who shop around at renewal typically save 0.3%–0.8% on their rate compared to accepting the lender's first offer. Always get at least three quotes from different lenders or work with a mortgage broker who can access multiple lenders simultaneously.
What are typical refinancing costs in the US?
US refinancing costs typically range from 2% to 5% of the loan amount. On a $400,000 mortgage, this means $8,000 to $20,000 in closing costs, including origination fee (0.5%–1%), appraisal ($300–$600), title insurance ($500–$1,000), and prepaid escrow items. Some lenders offer "no-closing-cost" refinances that roll fees into the rate or loan balance — the break-even calculator shows whether this trade-off makes sense for your situation.
Can I refinance to access home equity in Canada?
Yes — this is called a cash-out refinance. In Canada, you can refinance up to 80% of your home's appraised value. If your home is worth $900,000 and your mortgage balance is $500,000, you could refinance up to $720,000 (80%) and access up to $220,000 in equity minus any penalties and costs. This is distinct from a HELOC (Home Equity Line of Credit), which is a separate product that doesn't require breaking your mortgage.

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