Show a client the real saving from switching — monthly, yearly, and net of switching costs — plus how fast the move pays for itself. The number that starts most refinance conversations.
Current vs new loan
You could save
How brokers use this
- Lead with the net number. Clients fixate on rate; show them dollars saved after switching costs and cashback — that’s what actually moves them.
- Kill the “too much hassle” objection. A short break-even (often a few months) reframes the effort as trivially worth it.
- Be honest when it doesn’t stack up. If the saving is marginal after costs, say so. It builds the trust that wins the deal when it does make sense.
- Mind the term reset. This keeps the remaining term the same for a fair comparison — flag if a client is tempted to stretch back to 30 years and rebuild the interest.
How to read a refinance saving
The headline rate difference matters, but the decision should rest on the net position. This calculator compares the repayment on the current loan against a new loan at the lower rate over the same remaining term, so you’re comparing like with like rather than making the saving look bigger by stretching the loan back out.
It then subtracts the switching costs (discharge fee, new loan fees, any government charges) and adds back any cashback to find the true benefit and the break-even point — the number of months before the saving covers the cost of switching. A refinance that breaks even in a few months and keeps saving after that is usually a clear win; one that takes years to break even needs a closer look.
Frequently asked questions
What costs are involved in refinancing?
Typically a discharge fee from your current lender, and possibly application, valuation or settlement fees with the new lender (many are waived). Fixed loans may also carry break costs. A broker can total these up for your specific scenario before you commit.
Does refinancing hurt my credit score?
A loan application creates a credit enquiry, which can cause a small, temporary dip. A single, well-targeted application is nothing to fear — a broker assesses lender policy first so you apply where approval is likely, rather than scattering applications.
Should I refinance for a cashback?
A cashback improves the maths, but it shouldn’t drive the decision on its own. Look at the ongoing rate and features over the years you’ll hold the loan, not just the one-off payment. This calculator lets you include a cashback to see the full picture.
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Disclaimer: This calculator provides estimates for general information only and is not credit assistance, a credit quote, or financial advice. It assumes principal-and-interest repayments over the remaining term at constant rates and does not capture every fee or break cost. Confirm all figures with the lenders or a licensed mortgage broker.