Mortgage Refinance Cost-Benefit Analysis Guide for Rate Decision (2026)
Analyze mortgage refinance cost-benefit: closing cost payback, monthly savings, term extension impact, and total interest comparison for refinance decision.
Summary
Refinance decisions require total cost analysis. This guide explains break-even calculation, term impact, and interest savings comparison for refinance evaluation.
Key Steps
- 1Calculate closing costs: appraisal, title, origination fees total $3K-$10K.
- 2Determine monthly savings: current payment minus new payment.
- 3Compute break-even: closing costs divided by monthly savings.
- 4Assess term impact: extending term increases total interest despite lower rate.
- 5Compare total interest: original loan total vs refinance total interest.