Breakeven Bench

Testing a refinance against time: breakeven, term resets and total cost

Breakeven worksheet

On the bench

Write down the closing costs, both monthly payments, the months left on your current loan and the new term. Work out simple breakeven and the two remaining-payment totals, then set them against how long you expect to stay. A refinance that passes both tests within your time horizon is usually worth a closer look.

Last reviewed against the primary sources listed below.

Worksheet

  1. Closing costs, minus lender credits.
  2. Current principal and interest.
  3. Months left now.
  4. New principal and interest.
  5. New term in months.
  6. Years you expect to stay.

Breakeven questions

Where do I find the numbers?

Your current statement and a Loan Estimate for the new loan.

Consumer sources

Next: run the bench