Mortgage Refinance: When is it Worth it?
Lower your monthly payments and save thousands. Learn the 'Break-Even' point calculation for refinancing your home loan.
With interest rates shifting in 2026, many homeowners are asking: should I refinance? The answer depends on your remaining loan term and the closing costs of the new loan.
The 1% Rule of Thumb
Historically, a 1% drop in interest rates was the signal to refinance. But in 2026, even a 0.5% drop might be worth it if your loan amount is large enough. The key is calculating the 'Break-Even' point—the month when your monthly savings finally exceed the new loan's closing costs.
Cash-Out Refinancing
If you've built significant home equity, a cash-out refinance in 2026 can be a cheap way to consolidate high-interest debt or fund home renovations. Just be careful not to over-leverage your primary asset.