US · Canada · UK
Should I refinance?
Compare your current mortgage against a new rate. We work out your new monthly payment, how long it takes to recoup closing costs, and your lifetime savings.
Refinance outcome
$266.00
Monthly savings
- New monthly payment
- $1,896.20
- Current payment
- $2,162.20
- Break-even point
- 1 yr 4 mos
- Lifetime savings (net of costs)
- $13,920
An estimate to help you plan — not financial advice or a loan offer. An estimate of principal & interest only — your actual savings depend on closing costs, loan type, and how long you stay. Not a lending offer.
Mortgage rate trend
Past year, weekly national average
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Refinancing means replacing your mortgage with a new one — but whether it pays off depends on your country. In the US it's a break-even on closing costs; in Canada it usually triggers a prepayment penalty (three months' interest or the interest rate differential); in the UK it's a remortgage weighed against an early repayment charge. This tool works out the trade-off.
How this calculator works
In the US, a lower rate cuts your monthly payment; refinancing costs roughly 2–5% in closing fees, so the break-even is those costs divided by the monthly saving. Stay in the home past that point and the rest is pure saving.
In Canada, refinancing usually means breaking your term early, which costs the greater of three months' interest or the interest rate differential (IRD) — the IRD can be steep if rates have fallen since you signed.
In the UK it's a remortgage: you switch as a fixed deal ends to avoid the standard variable rate. Leaving a fix early incurs an early repayment charge (often 1–5%), and new deals usually carry a product fee.
A worked example
The break-even (US) and the penalty to weigh (Canada) look very different:
- US: $400k, 7% → 6%, $6k closing
- saves $263/mo · break-even 23 months
- Canada: breaking a $450k mortgage at 6%
- ≈ $6,750 penalty (3 months' interest, or the IRD if higher)
In the UK you'd instead weigh an early repayment charge (often 1–5%) plus a product fee against the new rate's saving.
Who it's for
- You want to know whether refinancing actually saves money.
- You're comparing the cost of refinancing across countries.
- You need the break-even, penalty, or early repayment charge before you commit.
Frequently asked questions
Should I refinance my mortgage?
In the US, if you'll stay past the break-even on closing costs. In Canada, only if the interest saved beats the prepayment penalty. In the UK, usually as your fixed deal ends to avoid the standard variable rate.
How do refinancing costs differ between countries?
The US charges closing costs (you recover them via a break-even); Canada charges a prepayment penalty to break a term (three months' interest or the IRD); the UK charges an early repayment charge plus a product fee if you leave a fix early.
What is a prepayment penalty?
A charge for paying off or breaking a mortgage early — most relevant in Canada, where it's the greater of three months' interest or the interest rate differential. US mortgages rarely have one.
When is the best time to refinance?
In the US, whenever the rate saving clears the break-even. In Canada, at renewal, to avoid the penalty. In the UK, at the end of your fixed deal, to avoid the early repayment charge.
A planning estimate, not a lending decision. Compare official Loan Estimates from lenders before refinancing.