🔁 Financing
Refinance
Break-Even Calculator
Find out exactly how long it takes to break even on a refinance. Never pay closing costs without knowing the payback period first.
Break-Even Point
0 months
Monthly savings: $0
Current Payment
$0
P&I only
Monthly Savings
$0
Payment reduction
Total Closing Cost
$0
Costs + points
5-Year Savings Analysis
Total Closing Costs—
Savings in Year 1—
Savings in Year 2—
Savings in Year 3—
Cumulative Savings (5yr)—
Net Benefit at 5 Years—
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Compare investment property refinance rates. A lower rate means faster break-even and more cash flow.
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Frequently Asked Questions
When should I refinance a rental property? ▾
Refinance when: (1) You can lower your rate by at least 0.5-1% and will hold the property past the break-even point; (2) You want to pull out equity for the next investment (cash-out refinance); (3) You want to change the loan structure (e.g., from a 15-year to a 30-year to improve cash flow); (4) You have an ARM coming to reset and want to lock in a fixed rate. The break-even calculation is most important when you're refinancing purely to lower your rate.
How do closing costs affect the refinance decision? ▾
Closing costs of 2-5% of the loan amount are typical. On a $250,000 loan, that's $5,000-$12,500. If you save $200/month, break-even is 25-62 months. If you plan to sell or refinance again within the break-even period, you should not refinance. Some lenders offer 'no-cost' refinances — they roll closing costs into the rate, which makes sense if you're uncertain about your hold period.
What is a cash-out refinance for real estate investors? ▾
A cash-out refi replaces your existing mortgage with a larger loan, returning the difference in cash. If your property is worth $400k, you have a $200k mortgage, and you refinance at 75% LTV ($300k), you receive $100k in cash (minus closing costs). Investors use this to pull equity out of appreciated or improved properties to fund additional purchases. The break-even calculation is different — you're not just comparing payments, you're evaluating the opportunity cost of the extracted capital.