Loan Refinance Savings Calculator
See How Much You Can Save
Compare your current loan with a new one to find your potential savings instantly. Whether it's a mortgage, car loan, or personal loan, see your total interest, monthly payments, and lifetime savings.
Current Loan Details
Leave blank to auto-calculate based on loan details
New Loan Details
Include closing costs, appraisal fees, etc.
Quick Tips:
- • Lower rate = lower monthly payments
- • Longer term = lower payments, more interest
- • Consider break-even point for fees
What Is Loan Refinancing?
Loan refinancing means replacing your current loan with a new one. This is typically done to reduce interest rates, change repayment terms, or lower monthly payments. The new loan pays off your old one, and you simply begin making payments under the new terms.
How to Calculate Refinance Savings
Savings = (Old Total Interest + Fees) - New Total Interest
The formula compares the total interest you'll pay on your current loan versus the new loan, minus any refinance fees.
Example:
Current loan: $200,000 @ 6% for 15 years = $103,788 total interest
New loan: $200,000 @ 4.5% for 15 years = $75,578 total interest
Refinance fees: $3,000
Total Savings: $103,788 - $75,578 - $3,000 = $25,210
When Should You Refinance a Loan?
Good Refinance Opportunities
- • Interest rates have dropped since your original loan
- • Your credit score has significantly improved
- • You want lower monthly payments
- • You plan to stay in your home long-term
- • You want to switch from adjustable to fixed rate
When to Be Cautious
- • Interest rates are higher than your current rate
- • You plan to move soon (won't break even)
- • High prepayment penalties on current loan
- • Extending term significantly increases total interest
- • Refinance fees are very high
Common Loan Types to Refinance
Mortgage Loan
Typical savings: $10,000–$50,000. Mortgage refinancing is the most common due to high loan amounts and long terms.
Auto Loan
Typical savings: $500–$2,000. Auto loan refinancing can lower payments but savings are smaller due to shorter terms.
Personal Loan
Typical savings: $300–$1,500. Personal loan refinancing can help consolidate debt or lower interest rates.
Business Loan
Typical savings: $2,000–$20,000. Business loan refinancing can improve cash flow and reduce financing costs.
Frequently Asked Questions
How do I calculate refinance savings?
Calculate the total interest you'll pay on your current loan versus the new loan, then subtract any refinance fees. Our calculator does this automatically and shows you monthly payment changes, total savings, and break-even point.
When is refinancing worth it?
Refinancing is worth it when your total savings exceed the refinance fees and you'll stay in the loan long enough to break even. A good rule of thumb is to refinance if you can lower your rate by at least 0.5-1%.
How much can I save by refinancing my loan?
Savings vary by loan type and amount. Mortgage refinancing typically saves $10,000-$50,000, while auto loans save $500-$2,000. Use our calculator to see your exact potential savings based on your specific loan details.
What are common refinance fees?
Common fees include application fees ($250-$500), appraisal fees ($300-$600), origination fees (0.5-1.5% of loan), title search and insurance ($1,000-$2,000), and attorney fees ($500-$1,500). Total costs typically range from 2-6% of the loan amount.
Does refinancing affect my credit score?
Refinancing may cause a temporary dip in your credit score due to the hard inquiry and new account. However, if you make timely payments on the new loan, your score should recover within 3-6 months and potentially improve long-term.