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The Cost to Refinance

Refinance closing costs can vary based on factors such as your loan amount and location. We’ll go through some of the most common closing costs, as well as the importance of breaking even.

What are the costs of refinancing?

Refinancing with closing costs in mind

If your goal in refinancing is to save money on your mortgage payment, it may be helpful to know your break-even point. This is the length of time it’ll take for your new monthly savings to equal your refinance closing costs. This often takes a few years, depending on those costs and how much you save. In other words, if you plan on selling your home before you break even, it may not be worth refinancing.

You can calculate your break-even point by dividing your refinance costs by the amount you'll save each month with your lower mortgage payment.

For example, if your refinance costs total $5,000 and a refinance mortgage will save you $200 a month, your calculation would be: $5,000 ÷ $200 = 25 months until you break even.

If you don't plan on staying in your house for that long, refinancing might not make sense in the long run.

Our refinance mortgage calculator can help you compare your current mortgage to a refinance loan, as well as show you your break-even point. Compare your options with our refinance calculator.

A breakdown of closing costs

Once you’ve submitted your refinance application, you’ll receive a Loan Estimate that itemizes the closing costs specific to your loan. Until then, here are some common closing costs and fees for a mortgage refinance.

Related Topics

Check out our refinancing guide

Looking for some flexibility in your finances? A mortgage refinance might be your answer.

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Learn about your refinance options

We’ll help you understand your refinance options and their key benefits.

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Learn about the refinance application process

From application to closing, refinancing isn't that different from the regular home buying process.

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Find the refinance option that’s right for you.  

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