Is refinancing worth the closing costs?

StepShown shows two dates because they answer different questions. The simple date divides closing costs by the monthly payment drop. The full date also counts what you still owe, because a longer loan can hide a larger balance. StepShown shows when the refinance first costs less, what happens when you expect to leave, and the full loan cost. If you take new cash out, the simple date is hidden because the payment also covers new borrowing.

Because rate and term are different things. Moving from twenty-two years remaining into a fresh thirty-year loan spreads the balance over eight extra years. The payment falls, but you pay interest for longer, and the total can exceed what you would have paid by staying put. A smaller payment is not the same as a cheaper loan.

When your old payment is at least as large as the new required payment, keeping that old payment can direct the rate reduction into principal instead of stretching the loan. You give up monthly relief, but the balance falls faster and lifetime interest is usually lower. It is not available when the configured new loan requires a higher payment.

Only if paying them would leave you without a cash reserve. Financing the fees means paying interest on them for the entire term, so it is more expensive overall; it simply moves the cost from today to the rest of the loan. The convenience is real, and so is the price of it.

It changes what you are doing. A refinance that changes only the rate and term replaces a loan; taking cash out borrows more money against your home. StepShown nets the cash you receive from the cost comparison so it does not count borrowed principal as a loss, but includes the interest that extra balance creates. Judge that borrowing on what the money is for and what its interest costs, not on whether the monthly payment looks manageable.

Long enough for the refinance to be ahead at the horizon you genuinely expect. The first crossing can arrive before a long term reset eventually gives the advantage back, so StepShown shows both the crossing and your chosen horizon. If a move is likely while the horizon result is still negative, the costs have not been recovered.