1. What is a Mortgage Payment Calculator for Refinance?

Definition: This calculator determines the monthly payment for a refinanced mortgage based on loan amount, interest rate, and loan term.

Purpose: It helps homeowners evaluate potential savings when refinancing their mortgage to a new rate or term.

2. How Does the Calculator Work?

The calculator uses the standard mortgage formula:

Where:

• \( M \) — Monthly payment (USD)
• \( P \) — Loan principal (USD)
• \( r \) — Monthly interest rate (annual rate ÷ 12)
• \( n \) — Number of payments (term in years × 12)

Explanation: The formula calculates the fixed monthly payment required to fully amortize the loan over its term.

3. Importance of Mortgage Payment Calculation

Details: Accurate payment calculation helps borrowers compare refinancing options, budget effectively, and determine if refinancing makes financial sense.

4. Using the Calculator

Tips: Enter the loan amount, annual interest rate (without % sign), and loan term in years. All values must be > 0.

5. Frequently Asked Questions (FAQ)

Q1: How does refinancing affect my monthly payment?
A: Refinancing typically lowers payments by reducing interest rate or extending the loan term, but may increase total interest paid.

Q2: What's included in the monthly payment?
A: This calculates principal and interest only. Your actual payment may include taxes and insurance (PITI).

Q3: How does loan term affect payments?
A: Shorter terms have higher monthly payments but lower total interest. Longer terms reduce monthly payments but increase total interest.

Q4: Should I include closing costs in the principal?
A: No, this calculator assumes principal only. Consider closing costs separately when evaluating refinance benefits.

Q5: How often are payments calculated?
A: Mortgage payments are typically monthly. This calculator uses monthly compounding.