How it works
This calculator only looks forward. It rebuilds your current schedule from the balance, contract rate and months you have left, then compares it with the new rate and term you enter. Fees rolled into the new loan raise the principal, so you pay interest on them too. Fees you pay upfront and any prepayment charge on the old loan are added once to the cost of refinancing.
The main result compares all the cash you'd still pay under each option, fees included. Break-even asks a slightly different question: in which month do the interest savings so far cover every refinance fee, including financed ones? That avoids treating a lower payment as a saving when you're really just repaying principal more slowly. It reports the first month the savings cover the fees, but if the terms differ, later interest can wipe that advantage out, so always check the full-term totals as well.
The formula behind the estimate
Every result starts with a defined model and visible assumptions.
Current future cost = remaining current-loan payments New principal = current balance + financed refinance fees Refinance future cost = new loan payments + upfront fees + old-loan prepayment charge Total savings = current future cost − refinance future cost Financing-cost break-even = first month cumulative interest saved covers all refinance fees.
A worked example
At 0%, a 12,000 balance with 12 months left means 1,000 a month and 12,000 in future payments. A new 12-month 0% loan with 120 of fees rolled in has a 1,010 payment and costs 12,120. Refinancing costs 120 more and never earns the fees back, because there's no interest to save. The example is built to isolate fees, not to suggest an offer you'll find.
Why can a lower payment cost more?
A longer replacement loan can lower your monthly payment while keeping you in debt for more months, and those extra months can cancel out a better rate. That's why this tool compares the whole remaining life of each loan rather than just the change in payment. Money you've already paid on the current loan is a sunk cost and isn't counted.
How is break-even worked out?
Each month, the model compares cumulative interest under the two schedules and checks whether the savings have covered the refinance fees. This gives the same answer as comparing cash paid plus the remaining balance, apart from rounding. It deliberately avoids dividing the fees by the payment reduction, which can mistake slower principal repayment for real savings. There's no discounting and no assumption that you'll refinance again later.
Do currency choices matter here?
Pick USD, PKR, INR, GBP, CAD, AUD, AED or EUR and keep every amount in that one currency. The selection doesn't tell the tool about eligibility, lender fees or national rules. The model describes a conventional fixed-rate loan with monthly payments on the declining balance, so get local advice for other structures and confirm the settlement process with both lenders.
Questions worth asking
Are financed fees counted twice?
No. Fees you finance are added to the new principal, so they show up in the new loan's payments once. The table lists them separately for clarity but doesn't add them to total future cash a second time.
Why does the tool say there's no break-even month?
It means the interest you'd save never adds up to the fees you entered over these two schedules. Recheck the rate, the fees and the term, and look at the full-term cost before deciding.
Can I compare a longer replacement term?
Yes, and you should look at total future cash and the number of months remaining, not only the lower payment. A longer term often costs more overall even at a lower rate.
Should I enter APR as the contract rate?
No, enter the interest rate charged on the outstanding principal. APR can already include fees, so using it and then adding the same fees again would overstate what the loan costs.
Does this quote a refinance rate for my country?
No. It doesn't know current rates, local eligibility or whether a lender would approve you. Enter the terms from a written offer in your selected currency.
This is general information, not personalized financial advice. Read the limitations.
