Mortgage Refinance Calculator
Monthly savings from refinancing your mortgage.
Calculate monthly savings and total interest reduction from refinancing your mortgage to a lower rate. Enter balance and new rate for an instant result.
What this tool does
Enter current mortgage balance, current rate, new rate, and remaining term. The tool calculates new monthly payment and total savings.
Enter Values
Formula Used
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Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
Mortgage refinancing to a lower rate produces immediate monthly savings. 200,000 balance at 6% vs 4% over 20 years: monthly payment drops 232 (1,432 vs 1,212). Total interest saved over remaining term: 55,800. Worth doing if rate difference exceeds 0.5-1% and you stay in home long enough to recover any fees.
A worked example
Try the defaults: current balance of 200,000, current rate of 6%, new rate of 4%, remaining term of 20. The tool returns 220.90. You can adjust any input and the result updates as you type — no submit button, no reload. That's the real power here: seeing how sensitive the output is to one or two assumptions.
What moves the number most
The result responds to Current Balance, Current Rate, New Rate, and Remaining Term. Not every input has equal weight. Flip one at a time toward extreme values to feel which ones move the needle most for your situation.
The formula behind this
Standard amortisation. Monthly payment = P × (r × (1+r)^n) / ((1+r)^n - 1). Saving = old - new. Everything the calculator does is shown in the formula box below, so you can check the math against your own spreadsheet if you want.
Why this matters before you sign
A mortgage is usually the biggest single financial commitment a person makes. The difference between a well-chosen product and a hasty one can run into tens of thousands over the life of the loan. Running the numbers here before committing is the cheapest form of due diligence available.
What this doesn't capture
The figure excludes arrangement fees, valuation costs, legal fees, insurance, and any early-repayment charges — those can add several thousand to the headline cost. Rate changes at renewal for fixed-term deals will shift the picture further. Use this for the core interest/principal math and add the other costs on top.
Refinancing produces savings based on the inputs provided.
Inputs
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
Standard amortisation. Monthly payment = P × (r × (1+r)^n) / ((1+r)^n - 1). Saving = old - new.
Frequently Asked Questions
How much rate cut justifies refinancing?
What about fees?
Can I refinance multiple times?
Should I extend term?
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