A lower refinance payment can help this month without lowering the cost of your mortgage. Compare three paths: keep your current loan, refinance and pay the new required amount, or refinance while continuing to pay your old principal-and-interest amount. The calculator below shows both the debt left at the same future date and the estimated interest plus fees.
This is for U.S. homeowners comparing fixed-rate, fully amortizing mortgages with no cash-out, no principal contribution at closing and no mortgage insurance. If your loans fall outside that scope, use the lender’s full schedules instead. This is an educational estimate, not an eligibility decision or a recommendation to refinance.
Compare the payment choice after refinancing
Illustrative inputs are prefilled. Replace every amount with documented numbers. Rates below are examples, not current offers. Enter 0 where applicable, not a blank.
Select Compare three paths to calculate. If the button is unavailable, use the worked example and method below.
Read the three columns as different decisions
The first column follows the remaining schedule on the current loan. The second follows the proposed refinance schedule. The third keeps paying the old P&I amount after refinancing, with the difference applied as extra principal. It is unavailable when the old payment is below the new required payment. Continuing the old payment may shorten repayment, but it also gives up the monthly cash relief shown in the second column.
The horizon is the number of months until a possible sale, another refinance or your next decision—not a prediction. Try a shorter and a longer realistic horizon. The comparison stops loan payments after a modeled payoff; it does not assume that freed-up cash earns an investment return.
Worked example: a $421 payment reduction is not $421 of cost savings
Assume $250,000 remains at 7% with 240 payments left. A hypothetical new loan is 6% for 360 months, with $6,000 of fees: $3,000 paid in cash and $3,000 financed. The new balance is $253,000. Compare the paths after 60 monthly payments. These are fictional rates and fees, not current market prices.
| At month 60 | Keep current loan | Refinance: required payment | Refinance: keep old P&I |
|---|---|---|---|
| Monthly P&I | $1,938.25 | $1,516.86 | $1,938.25 |
| Loan payments made | $116,295 | $91,012 | $116,295 |
| Balance still owed | $215,642 | $235,428 | $206,028 |
| Interest plus refinance fees | $81,936 | $79,439 | $75,322 |
| Cost reduction vs. keeping loan | Baseline | $2,497 | $6,614 |
| Modeled months until payoff | 240 | 360 | 213 |
| Full remaining interest plus fees | $215,179 | $299,071 | $163,935 |
The lower required payment frees about $421 a month initially, but leaves about $19,786 more debt at month 60 than keeping the current loan. After fees, the five-year modeled cost advantage is about $2,497. If paid over the full new 30-year term, total remaining interest plus fees is higher. Paying the old amount instead changes both the balance and payoff date; it is not the same cash-flow choice.
Keep closing cash separate from loan cost
Enter total transaction fees after lender credits, then the portion financed. Include documented points and applicable one-time charges; do not count the same fee twice. The calculator adds financed fees to the new principal and includes all fees once in borrowing cost. The CFPB explains that a no-closing-cost refinance can involve a higher rate or a larger balance.
Do not copy the entire Cash to Close figure into the fee box. Reconcile the lender’s itemization: escrow deposits, prepaid insurance and interest, principal adjustments and transaction fees have different purposes. This simplified model excludes closing-date daily-interest adjustments and escrow timing. Ask the lender to reconcile any difference between its new loan amount and this calculator’s balance-plus-financed-fees amount.
| Cash checkpoint | Your documented amount |
|---|---|
| Cash required at closing, from the lender’s current disclosure | $_____ |
| Funds already available for that payment | $_____ |
| Amount still needed before closing | $_____ |
| Possible old escrow refund: amount and expected date | $_____ / date_____ |
| Cash you want to retain after closing | $_____ |
A pending refund is not available closing cash. For a fictional $5,000 payment due at closing and $4,000 available, the immediate gap is $1,000 even if a $1,500 refund is expected later. Confirm the timing and amount rather than treating the refund as a fee discount. A loan can look cheaper over five years and still require cash you do not have on closing day.
How to check the calculation
Monthly P&I is balance × monthly rate ÷ [1 − (1 + monthly rate)−months]. Monthly rate is the annual note rate divided by 1,200 when entered as a number such as 6. At 0%, divide the balance by the months. Use the note rate, not APR, in this formula.
Each month, interest equals the beginning balance × monthly rate. The payment is capped at balance plus interest; the remainder reduces principal. The example keeps unrounded values internally and rounds displayed results, so displayed differences can vary by $1. Actual servicer rounding and payment dates can differ.
For a no-cash-out comparison, check this identity at the same horizon: loan payments made + cash-paid fees + balance still owed − original principal = interest paid + all refinance fees. That is why counting only lower monthly payments misses debt that remains. No tax deductions, investment returns, home appreciation, rate resets, mortgage insurance or penalties are modeled. Resolve any applicable penalty separately before relying on the result.
Before changing your payment
Compare the proposed P&I with your Loan Estimate, and review the Closing Disclosure before closing. Use the full housing-payment calculator to budget taxes, insurance and HOA separately.
If you choose the old-payment path, ask the servicer how to designate extra principal and confirm the next statement shows the intended allocation. Our extra-principal payoff worksheet explains the follow-through. If you need additional borrowing rather than a rate-and-term change, see the separate HELOC versus cash-out comparison.
Sources and scope
Reviewed November 10, 2026. CFPB: Should I refinance? supports the term-and-payment tradeoff; CFPB: Compare loan offers explains comparing costs and disclosures; CFPB: Mortgage servicer rules covers payment handling. The model and fictional example were prepared with AI assistance and checked arithmetically; they are not a lender quote or an independent professional review.