Student Loan Refinance Calculator
This calculator shows how many months of lower payments you need before refinance savings cover your closing costs. Enter your balance, current rate, and a lender's offer to see the break-even month. On an $85,000 balance, even a modest rate reduction can save thousands over the loan's life, but only if you remain in repayment past that threshold.
New monthly payment
You pay today, so that is a month back in your pocket.
That is more than the you pay today — the shorter term costs more each month but clears the debt sooner.
- Over the whole termStay putRefinance
- Monthly payment
- Interest you pay
- Debt-free
- Total paid
No switching cost to earn back — you are ahead from the first payment, by over the life of the loan.
You earn the switching cost back after payments — around .
At these numbers the new loan never pays for itself: the monthly payment does not fall.
Careful — the lower payment comes from a longer term. Over the full term this deal costs more than staying put.
Both loans are modelled as fixed-rate, fully amortising, with no missed months. A refinance replaces your loan with a brand-new private loan — see what that costs you below.
Rate drop
Monthly change
Interest saved
Lifetime saving
What you give up when federal loans go private
- Income-driven repayment. A private lender sets one payment; it does not fall when your income does.
- Federal forgiveness programmes, including Public Service Loan Forgiveness and any income-driven forgiveness after the full repayment term.
- Federal discharge on death or total and permanent disability — private lenders decide their own policy.
- Federal deferment and forbearance rights, and the federal rehabilitation route out of default.
- The decision is one-way. Once a federal loan is refinanced privately, it cannot be turned back into a federal loan.
Refinancing private loans into a cheaper private loan gives up none of this — it is federal balances that carry the risk.
What You Lose by Refinancing Federal Loans
Refinancing federal student loans into a private loan is a one-way door. You permanently give up access to income-driven repayment plans like RAP and IBR, Public Service Loan Forgiveness (PSLF), and any remaining IDR forgiveness. Under current law, IDR forgiveness carries a federal income-tax liability from 2026 onward because the ARPA exemption expired on December 31, 2025. PSLF remains tax-free, but it requires federal loan status, which refinancing eliminates.
You also lose federal forbearance and deferment protections, plus death and total-and-permanent-disability discharge. Borrowers on student-loan forums report refinancing regret most often after an unexpected job loss removed the income stability that made the lower rate worthwhile. Before committing, compare the dollar value of these federal protections against the projected interest savings this calculator shows. If you work for a qualifying public-service employer or plan to use income-driven repayment for several years, the federal safety net may outweigh any private-market rate reduction.
How Break-Even Works
Break-even is the number of months it takes for your lower monthly payment to recoup the up-front costs of refinancing—origination fees, application fees, or both. If you move an $85,000 balance from 6.8% to an illustrative 5.2% on a 10-year term, the monthly payment drops by roughly $70 (illustrative). Divide your total closing cost by that monthly saving and you have your break-even month.
Two factors shift break-even more than most borrowers expect. First, extending your repayment term during refinancing—say from 8 remaining years to 10—lowers the monthly payment further but increases total interest paid over the life of the loan. The calculator shows both the monthly saving and the lifetime interest difference so you can spot that trade-off. Second, variable-rate offers look cheaper at signing but can push your break-even out if rates climb. Use a fixed-rate offer for the most reliable estimate, then compare scenarios with the fixed-vs-variable calculator.
Rate examples are illustrative only. This calculator does not constitute financial advice. Consult your loan servicer before refinancing federal loans.
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Related student loan calculators
- Federal Consolidation vs Private Refinance
- Forgiveness "Tax Bomb" Calculator
- Fixed vs Variable Rate: Side by Side
- Cosigner Release: When Do You Qualify?
- Rate Shopping Without Wrecking Your Credit
Sources
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Sources: studentaid.gov (federal loan protections, IDR/PSLF); ARPA §9675 tax-exemption expiry (Dec 31, 2025); ed.gov SAVE/RAP transition fact sheet.
- Federal Direct Consolidation Loan interest rate — the weighted average of the loans being consolidated, rounded up to the nearest one-eighth of one percent (Federal Student Aid, studentaid.gov, Loan Consolidation).
- Amortisation, daily interest accrual and payoff arithmetic — standard loan mathematics; every figure on this page is computed from the numbers you enter.