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UniKit

Refinancing calculator

Compare staying on your current loan with refinancing into a cheaper one: amortise both sides month by month and get the change in payment, the interest saved, the break-even month and year for the closing costs, and a nominal plus inflation-adjusted net present value using editable discount-rate assumptions.

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Loan and refinancing parameters

All money is handled as integer cents, amortised monthly with equal instalments and a final payment that clears the balance; the closing costs are paid in cash at month 0 and are not added to the new loan.

Comparison

Current monthly payment5,503.10
New monthly payment4,932.57
Payment change (current − new)570.53
Interest left on the current loan520,743.40
Interest on the new loan383,815.39
Total closing costs7,000.00
Interest saved (current − new − costs)129,928.01
Break-even month13 months
Break-even year1.1 years
Net present value (nominal)96,250.05
Net present value (inflation-adjusted)117,346.54

Year-by-year cash flow

Net saving = current payments − new payments for the year, less the closing costs taken in year 1; the discounted column brings each year back to today at 3%.

YearCurrent planNew planNet savingDiscounted saving
166,037.2059,190.84-153.64-262.14
266,037.2059,190.846,846.366,541.61
366,037.2059,190.846,846.366,351.08
466,037.2059,190.846,846.366,166.10
566,037.2059,190.846,846.365,986.50
666,037.2059,190.846,846.365,812.14
766,037.2059,190.846,846.365,642.85
866,037.2059,190.846,846.365,478.50
966,037.2059,190.846,846.365,318.93
1066,037.2059,190.846,846.365,164.01
1166,037.2059,190.846,846.365,013.60
1266,037.2059,190.846,846.364,867.57
1366,037.2059,190.846,846.364,725.80
1466,037.2059,190.846,846.364,588.15
1566,037.2059,190.846,846.364,454.52
1666,037.2059,190.846,846.364,324.78
1766,037.2059,190.846,846.364,198.81
1866,037.2059,190.846,846.364,076.52
1966,037.2059,190.846,846.363,957.78
2066,036.6059,189.436,847.173,842.96

What this tool does

  • You have a cheaper rate on the table — check whether it is worth switching: 800,000 left at 5.5% with 20 years to run drops 570 a month at 4.2%, recovering 7,000 of fees in 13 months.
  • Tell whether "interest saved" is an illusion: stretching the new term lowers the payment but raises total interest, and this tool weighs the payment change, the interest change and the costs together instead of looking at the payment alone.
  • Price the cost of a shorter term: switching to 15 years raises the payment by 495 a month but saves 2.34 million of interest, and break-even only arrives in month 198.
  • Run a sensitivity check: move the discount rate from 0% to 6% and see how much net present value survives, so you know whether the deal holds under a different opportunity cost.

Example

Input

Remaining principal 800,000 at 5.5% with 240 months left; new loan at 4.2% over 240 months; closing costs 0.5% of principal plus 3,000 fixed; discount rate 3%, inflation 2%

Output

Current payment 5,503.10, new payment 4,932.57, a 570.53 monthly difference; interest left on the current loan 520,743.40 versus 383,815.39 on the new one; costs 7,000.00; interest saved 129,928.01; break-even in month 13 (about 1.08 years); nominal NPV 96,250.05 and 117,346.54 after inflation

The break-even month is when cumulative payment savings first cover the closing costs. At 570.53 a month it takes 12.3 months to accumulate 7,000, so month 13 is the first profitable one.

Frequently asked questions

Why is the net present value below the interest saved?

Interest saved simply subtracts one interest total from the other, while net present value discounts each month’s saving back to today at your opportunity cost. Because the savings arrive month by month they shrink when discounted, so NPV sits below the raw interest difference — and a higher discount rate shrinks it further.

The payment change is negative — can I still refinance?

A negative change means the new payment is higher, usually because the term was shortened. Look at the interest saved instead: if the remaining interest drops a lot the deal still wins over time, at the cost of more monthly cash and a slower break-even. The tool reports both so you can weigh them.

What should I put in for the closing costs?

Include every one-off cost: prepayment penalty, valuation, mortgage registration, guarantee and notary fees. Put the part charged as a percentage of the balance in the rate field and the rest as a fixed amount. If the lender waives everything, enter zero and the break-even month becomes the first month.

Why is the monthly difference constant when both terms are equal?

An equal-instalment payment is constant across the whole term, so two loans with the same term differ by a constant amount every month. Cumulative savings then rise in a straight line and the break-even month is simply costs divided by the monthly difference. With different terms the new payment differs and the line bends.

Which discount rate should I use?

The return you can reliably earn elsewhere: 2%–3% for conservative deposits, 5%–6% for a balanced portfolio. A higher rate makes future savings worth less and refinancing less attractive. Inflation only affects the inflation-adjusted column, which shows the real purchasing power of the saving.

Keywords：refinancingmortgage refinancebreak evennet present valueamortisation再融资房贷转贷盈亏平衡净现值月供

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