Refinance calculator

Calculating loan refinance costs involves several factors:

1. Application Fees: Some lenders charge an application or origination fee when you apply for a new loan. This fee can vary widely depending on the lender and the type of loan.

2. Closing Costs: Similar to when you initially obtained your business loan, refinancing typically involves closing costs. These may include fees for appraisal, title search, attorney services, and other administrative expenses.

3. Prepayment Penalties: Check if your current loan carries any prepayment penalties for paying off the loan early. If so, factor in these costs when calculating the total cost of refinancing.

4. Interest Rate: The new interest rate on your refinanced loan will determine your monthly payments and the total interest you’ll pay over the life of the loan. A lower interest rate can lead to significant savings over time.

5. Loan Term: Consider whether you’re extending or shortening the term of your loan. While a shorter term can save you money on interest in the long run, it may also result in higher monthly payments.

To calculate the total cost of refinancing, add up all the fees and costs associated with obtaining the new loan. Then, compare this figure with the potential savings you’ll achieve through lower monthly payments and reduced interest over the life of the loan. This will help you determine whether refinancing is a financially prudent decision for your situation.