What Is a Mortgage Rate Refinance Calculator?

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With interest rates always fluctuating in response to economic shifts, many homeowners who are interested in refinancing their mortgages often try to do so when rates are lower. Otherwise, they might not secure a deal that’s genuinely better than what they currently have — and thus won’t save money in the process.

If you’re looking to determine whether refinancing is a wise financial move, using a mortgage refinance calculator is a great idea because it allows you to quickly compare various rates and terms to make an informed decision. If you’re wondering what a mortgage rate refinance calculator is, how it works and more, here’s what you need to know.

How Does a Mortgage Refinance Calculator Work?

A mortgage refinance calculator is a simple tool that lets you see the potential benefits and drawbacks of refinancing your current home loan. Essentially, it gives you a financial overview that shows how a new mortgage may work out, allowing you to see the short- and long-term impacts of the decision and how much it would end up costing.

Functionally, mortgage refinance calculators use specific mathematical equations to estimate monthly payments, calculate the total interest paid over the life of your loan and handle other calculations to get you important details. In many ways, the various resulting metrics ensure you aren’t enticed by something on the surface and that you don’t move forward in refinancing without understanding the whole picture.

How to Compare Mortgage Refinance Calculators

Generally speaking, most mortgage refinance calculators perform the same core calculations. Additionally, since their math is based on set facts, figures and equations, the results you see will broadly be the same regardless of the calculator you select.

However, some mortgage refinance calculators have some extra features that prove useful. For instance, some offer amortization tables, while others don’t. A few calculators allow you to enter in details about your current mortgage and one you’re considering, making a direct side-by-side comparison possible. But again, others won’t have that capability.

Whether you need those extra features is a personal decision. If not, most mortgage refinance calculators will treat you well. If you’d prefer them, then you’ll need to track down the ones that have the additional functionality you want.

What Are the Best Online Mortgage Refinance Calculators?

No online mortgage refinance calculator is inherently better than others. The math equations and your results remain consistent across platforms, so you can get the details you need using practically any reputable calculator.

If you aren’t sure where to begin, it’s usually best to stick with calculators from somewhat neutral reputable sources. Some places to consider include real estate websites and your own bank or credit union’s site.

How to Use 15-, 20- and 30-Year Refinance Calculators

Using a mortgage refinance calculator is pretty straightforward. Typically, all you need to do is input your current home value, followed by your remaining mortgage balance. Then, you can input your loan term — choosing between classic timeframes like 15, 20 or 30 years — and an interest rate.


Once you’ve added that data, you may need to hit a “calculate” button. However, some calculators update the results as you change parameters, so that may be unnecessary.

If the calculator you select has additional features, you may have more options. For example, comparison calculators may let you input details about your current mortgage, making it easier to compare it to new terms.

If you aren’t sure how to use a mortgage refinance calculator, read the on-screen instructions. Most institutions provide clear guidance about what you need to do, so review it if you have questions.