Refinance Savings Calculator
Compare your current home loan repayment to a refinanced rate and see how long it takes to recoup the switching costs.
- Total interest saved
- $58,920
- Time to recoup refinancing costs
- 8 months
This calculator provides estimates only. It is general information, not financial or taxation advice, and doesn't account for your full personal circumstances. Confirm figures with your lender or a licensed adviser before making a decision.
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How this calculator works
Refinancing means replacing your current home loan with a new one — usually to get a lower interest rate, but it comes with switching costs like discharge fees from your current lender and application or legal fees with the new one. This calculator compares your current repayment to what you'd pay at a new rate on the same remaining balance and term, and works out how long the repayment saving takes to cover the switching costs.
Enter your current loan balance, rate and remaining term, the new rate you've been offered, and the estimated refinancing costs. It assumes the new loan runs over the same remaining term as your current one, so the comparison isn't distorted by resetting the clock back to a full 30 years.
Worked example: refinancing a $450,000 balance with 25 years remaining from 6.8% to 6.1% cuts the monthly repayment from $3,123.32 to $2,926.93 — a saving of $196.40 a month — and saves $58,919.52 in total interest over the remaining term. At $1,500 in refinancing costs, that saving pays for itself in about 8 months.
Watch out for resetting the loan term: refinancing into a fresh 30-year term when you only had 25 years left will lower your repayment further, but you'll pay more total interest overall by stretching the loan back out — this calculator assumes you keep the same remaining term to show the true rate-only saving.
Frequently asked questions
- What refinancing costs should I include?
- Typically a discharge fee from your current lender (often $150–$400), and with the new lender an application or settlement fee and sometimes legal/valuation fees. Ask both lenders for an exact figure — cashback offers can also offset these costs.
- Should I reset my loan back to a full 30-year term when refinancing?
- It lowers your monthly repayment but extends how long you're paying interest, usually costing more in total interest even at a lower rate. This calculator keeps your remaining term unchanged so you can see the saving from the rate alone.
- Does this include lenders mortgage insurance (LMI)?
- No. If refinancing pushes your loan-to-value ratio above 80%, you may be charged LMI again even if you didn't pay it on your original loan. Check this with your new lender before switching.