Refinancing Your Mortgage: When Does It Make Sense?
2026-03-10 · 5 min read · Guide
The Break-Even Rule
Refinancing costs 2-3% of your loan balance. Divide the total cost by your monthly savings to find the break-even point.
Example: Refinancing a $300K loan costs $7,500. If you save $200/month, break-even is 37.5 months. If you plan to stay in the home longer, refinancing makes sense.
When to Refinance
Generally worth it when rates drop at least 0.75-1% below your current rate AND you plan to stay in the home past break-even.
Cash-Out Refinance
You can also refinance to access home equity. Rates are typically 0.125-0.25% higher than regular refinancing. Useful for home improvements or debt consolidation.
Our team analyzes data from Freddie Mac & HUD to deliver accurate, up-to-date information. All data is verified and cross-referenced with official sources.