Refinancing Your Mortgage
Work Sheet

Prepared by: Patricia Gorman, graduate assistant, and Kathleen Parrott, Extension housing specialist, Virginia Tech

September 1996

Source: Kiplinger's Personal Finance Magazine

The example is for refinancing a $100,000, 30-year fixed-rate mortgage at 10% with the same mortgage at 8%. (28% tax rate)
THE COST OF REFINANCING:		Example		Your Loan
Loan origination fee		$ 1,000		$ _______
Discount points		2,000		_______
Application fee *		100		_______
Appraisal fee		200		_______
Title examination		250		_______
Title insurance for lender		350		_______
Land survey		150		_______
Credit report		50		_______
Documentation/preparation		10		_______
Legal fees		250		_______
TOTAL COST OF REFINANCING		$ 4,360		$ _______
THE PAYBACK:
Current monthly mortgage payment (principal & interest)		$ 878		_______
Subtract new monthly mortgage payment (principal & interest)		- 734		_______
Pretax savings per month		144		_______
Multiply your tax rate by your pretax savings & subtract result		- 40	(28%)	_______	(____)
Your after-tax savings per month		104		_______
Divide monthly savings ($104) into total cost of refinancing ($4360)
NUMBER OF MONTHS TO BREAK EVEN		42		_______
* Application fees may not be refundable if you are not approved for refinancing. Check with your lender.

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