$
%
%
$

Often 2% to 5% of the loan

Years

More options· New loan length and lender credits

Years to pay it off

$

From the new lender

Switching saves you

$15,171

Over 7 years, after $6,000 of costs

New monthly payment
$2,111 (now $2,312)
Costs earned back
After 2 years

What this means

The interest you save covers the $6,000 of costs after 2 years. That’s within the 7 years you’d keep the new deal.

Stay or switch, over 7 years

StaySwitch
Monthly payment$2,312$2,111
Interest$165,705$144,534
Costs, less cashback$0$6,000
Interest and costs$165,705$150,534
Still owed after 7 years$271,515$267,243

Before you switch

  • Paying points lowers the rate but raises closing costs: worth it only if you keep the loan long enough.
  • A new 30-year loan restarts the clock. Keep your payment the same to stay on track.
Assumptions in this estimate
  • Both rates stay the same for the whole period. The saving counts interest and costs only: paying the loan off faster isn’t a cost, as that money becomes your home equity.
  • Interest is worked out monthly.
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