Compare your current loan with a refinancing offer, and see how much you could save per month and in total by switching to a lower rate.
The calculator computes the monthly payment with the amortization formula for both the old and the new loan, using the same loan amount and term, and compares them:
Refinancing is often used to consolidate expensive consumer loans and credit card debt into a single loan with a lower rate, which can significantly lower your monthly expenses.
If you enter an expected fee for switching (an origination fee on the new loan and/or a payoff fee on the old one), the calculator also shows how many months it takes before the monthly savings have covered the fee — the "break-even" point for the refinancing.
It's usually worthwhile when the new rate is noticeably lower than the old one, and the remaining term is long enough that the savings exceed any fees involved in switching.
A credit check when applying for refinancing can cause a small, temporary dip in your credit score, but this usually normalizes quickly.