Student Loan Refinance Calculator
Enter your current loan, then the refinance offer. The calculator returns side-by-side monthly payments, lifetime cost of each path, break-even months on any closing costs, and a federal-protections checklist if your current loan is federal.
Results
How the math works
Both sides of the comparison use the standard fixed-rate amortization formula:
M = P × r × (1+r)n / ((1+r)n − 1)
where P is the loan balance, r is the monthly rate (annual rate ÷ 12), and n is the number of months. Lifetime cost on each side is M × n; the refinance side adds any closing fees on top. Break-even months are fees ÷ (Mold − Mnew) — the number of months you must hold the refinanced loan before the cumulative monthly savings recover the fees.
When refinance saves money
- New rate is meaningfully lower than the current rate — generally a 1+ percentage-point drop to overcome friction.
- Same or shorter term — extending the term can erase rate savings (term-extension trap, see below).
- Break-even fits inside the remaining loan life — a 36-month break-even on a 24-month-remaining loan loses money.
- You don't need federal protections — see the IDR/PSLF/forbearance forfeiture checklist below for federal loans.
The term-extension trap
Refinancing $40,000 from 7.5% / 96 months remaining into 6.25% / 144 months (12 years) drops the monthly payment from $555 to $396 — a $160/mo headline "savings" — but lifetime cost rises from $53,314 to $56,957, a $3,643 lifetime LOSS. The lower monthly payment is paid back many times over the extra 48 months of interest. The calculator flags this with a yellow callout when monthly drops but lifetime rises.
Federal-to-private forfeiture checklist
When the current loan is marked federal, the calculator surfaces a red warning listing the protections that permanently disappear on refinance:
- PSLF — Public Service Loan Forgiveness after 120 qualifying payments (tax-free per IRC §108(f)(1)).
- IDR — Income-Driven Repayment (IBR, PAYE, ICR for pre-Jul-2026 borrowers; RAP per HEA §493D / OBBBA Pub. L. 119-21 §82001 for new borrowers).
- Federal forbearance + deferment — economic hardship, unemployment, in-school, and natural-disaster forbearance.
- Death + total-and-permanent-disability discharge — federal loans extinguish at death; private loans pass to the estate or co-signer.
- Future federal forgiveness — any program Congress enacts in the future (the 2022 Biden cancellation, the 2023 SAVE plan, etc.) is forever out of reach once the loan is private.
- Tax-free PSLF status — IRC §108(f)(1) permanent exclusion does not extend to private refinanced loans.
2026 rate landscape
Federal AY2025-26 rates (per Dept. of Ed. May 2025 announcement): 6.39% Direct Subsidized/Unsubsidized Undergrad, 7.94% Direct Unsubsidized Grad, 8.94% Direct PLUS. Private refinance quotes (per 2026 lender disclosures): 4.99–9.99% fixed APR depending on credit profile. Variable-rate quotes typically start 50–100bp lower but reset monthly with the prime rate (currently 7.25% per Fed H.15 release).
Related calculators
- Student Loan Repayment Calculator
- Income-Driven Repayment Calculator
- Student Loan Forgiveness Calculator (PSLF / IBR / PAYE / RAP)
- Student Loan Interest Deduction (§221) Calculator
- Student Loan Snowball vs Avalanche Calculator
- Parent PLUS Loan Calculator
- Grad PLUS Loan Calculator
Related reading
Frequently Asked Questions
How does this refinance calculator work?
It takes your current loan (balance, current annual rate, months remaining) and a refinance offer (new annual rate, new term in years, closing/origination fees) and computes both sides with standard amortization: M = P × r × (1+r)^n / ((1+r)^n − 1). It then reports current monthly payment vs new monthly payment, the lifetime total cost of each path (including fees on the refinance side), the monthly savings, the lifetime savings (negative = refinance costs more total), and the break-even months = fees / monthly savings. A new rate that is higher than the current rate produces a negative-savings warning, and a lower monthly payment achieved by extending the term flags the term-extension trap if lifetime cost goes up.
What is the break-even on a student loan refinance?
Break-even is the number of months it takes for cumulative monthly savings to recover the upfront refinance costs. The formula is fees ÷ (current monthly payment − new monthly payment). If the break-even exceeds the remaining time on the loan, the refinance loses money even though the monthly payment dropped. The 2026 private student-loan refinance market is largely no-fee — SoFi, Earnest, ELFI, and Laurel Road advertise zero origination and zero application fees — so for most quotes the break-even is zero and any monthly savings translates directly to lifetime savings. Verify the lender's Truth-in-Lending disclosure for any fee at closing.
Should I refinance federal student loans into a private loan?
Refinancing federal loans into a private loan is irreversible — once converted to private, the loan can never re-enter the federal system. Doing so permanently forfeits Public Service Loan Forgiveness (PSLF, IRC §108(f)(1) tax-free discharge), all income-driven repayment plans (IBR, PAYE, ICR, and the new OBBBA Repayment Assistance Plan per HEA §493D), Department of Education forbearance and deferment, death and total-and-permanent-disability discharge, and access to any future federal forgiveness Congress may enact. The calculator surfaces a red federal-protections warning when you mark the current loan as federal. For high-income borrowers with stable employment in non-public-service careers and no expectation of IDR or PSLF, the rate savings can justify the trade-off. For anyone with PSLF eligibility, income volatility, or balances over 1.5× annual income, refinancing federal loans is rarely the right call.
Does extending the loan term reduce my total cost?
No — extending the term almost always increases total interest paid even at a lower rate, because you finance the balance for more months. The calculator flags this with a yellow term-extension-trap callout when monthly payment falls but lifetime cost rises. Example built into the test cases: a $40,000 loan at 7.5% with 96 months remaining vs a 6.25% refinance over 144 months (12 years) cuts the monthly payment from $555 to $396 (−$160/mo), but lifetime cost rises from $53,314 to $56,957 — the refinance costs $3,643 MORE total despite the lower monthly payment. Refinance into a SHORTER or SAME term to capture rate savings without the term-extension penalty.
What 2026 refinance rates can I realistically expect?
Per published 2026 rate disclosures from SoFi, Earnest, Education Loan Finance (ELFI), Laurel Road, and Splash Financial, fixed-rate quotes span roughly 4.99%–9.99% APR depending on credit score, income, debt-to-income ratio, and chosen term. Variable-rate quotes start lower (often 4.49%–5.50%) but reset monthly with the prime rate (currently 7.25% per the Fed H.15 release). Borrowers with 720+ FICO, household income above $80,000, and stable W-2 employment in lender-favored fields (medicine, law, finance, engineering) qualify for the bottom of the band. Always shop at least three lenders and pull all soft-credit pre-qualifications within a 14-day window to consolidate the inquiries into a single FICO event per FCRA §615(f)(3) credit-scoring rules.