Refinance break-even calculator (2026)
How long does the lower repayment from a new lender need to run before it pays off the cost of switching? This page does the maths. Edit your scenario in the form below or via URL parameters.
Verdict
Strong caseBreak-even within 0 months. Compelling — the saving compounds quickly after that.
Monthly saving
$299
Annual saving
$3,590
Net upfront cost
$0
Break-even
0 mo
| Scenario | Rate | Monthly repayment | Total interest (full term) |
|---|---|---|---|
| Stay with current lender | 6.84% | $4,180 | $653,889 |
| Refinance | 6.04% | $3,880 | $564,148 |
| Difference | −0.80pp | −$299/mo | −$89,742 |
Net saving over time
After break-even, every month is pure saving. Cumulative net saving (i.e. saving minus the initial upfront cost):
- After 5 years: $17,948
- After 10 years: $35,897
- Over the full 25-year term: $89,742
Cashback clawback warning
Most refinance cashback offers carry a clawback period of 2-3 years — if you discharge or refinance again within that window, the lender reclaims the full cashback amount. Factor this in if you're switching primarily for the cashback. The cleanest approach: refinance to the lender with the best ongoing rate, treat any cashback as a bonus, and don't plan around it.
What this calculator doesn't model
- Fixed-rate break costs. If you're mid-fix, the bank charges a break cost calculated on the present value of their lost margin. This can run into tens of thousands. Use the bank's quote, not this calculator's number.
- Loan term reset. If your new loan resets to 30 years (a freshly-originated loan typically does), monthly repayments drop further but total interest paid over the longer term may be higher. Match the new term to your remaining term to compare apples-to-apples.
- LMI re-crystallisation. If your current LVR is above 80%, a new lender will charge fresh LMI on the new loan. This can wipe out years of break-even progress. Wait until your LVR is below 80% (via repayment or appreciation) before refinancing if at all possible.
- Offset balance impact. If you're moving from a loan with a 100% offset to one without, the effective rate gap is smaller than the headline number suggests.
Where to find current rates
See our home-loan rates page for current advertised variable rates from 12 lenders, post the May 2026 RBA hike. The lowest rates today are around 6.04% from online lenders, vs typical Big Four rates of 6.84-6.99%.
If you've been on the same loan for 2+ years without negotiating, you can often get a 0.20-0.40% discount from your existing lender just by asking — sometimes more than refinancing would save you, with no switching costs at all. Our guide to comparing home loans walks through the negotiation playbook.
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