Cost of Refinance

This equation computes the difference between your current mortgage payment and what your payment at a lower refinance interest rate will be. Add in the refinancing costs, ( fees for a new title search, points you'll pay, the cost of an appraisal, and other closing costs. Multiply your federal tax rate by the monthly difference to find after-tax savings. Divide after-tax savings into the cost of refinancing to determine how long it will take you to recoup your costs.