Should you refinance or do a balance transfer on your home or personal loan? This calculator compares the total cost of staying with your current loan against switching to a new lender at a lower rate, factoring in processing fees and break-even time.
Current loan
New offer
Monthly EMI saving
₹2,287
₹36,548 → ₹34,261
Total saving
₹3,96,630
Over new tenure
Break-even
7 mo
When fee is recovered
Total cost old vs new
Refinance is profitable
Saves ₹3,96,630 total. Break-even at month 7 - refinance if you'll stay in this loan past then.
Floating-rate home loans in India have no prepayment penalty - balance transfers are typically free of exit charges. Confirm with your existing lender. Tax benefits transfer to the new lender for the same property.
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Home-loan refinancing in India has become routine since RBI mandated the end of prepayment penalties on floating-rate retail loans. With dozens of banks and NBFCs competing for prime customers, a 0.5-1% rate reduction is often available simply by transferring your existing loan to a new lender. On a ₹50 lakh outstanding balance with 15 years remaining, even a 0.5% reduction saves roughly ₹4-6 lakh in interest over the remaining tenure - a meaningful win for an hour of paperwork and a few weeks of processing.
But refinancing isn't always profitable. Processing fees (0.25-1% of loan amount), legal and valuation charges (₹10,000-25,000), and lost time can offset the rate-cut benefit. This calculator computes the exact break-even - how many months of lower EMI it takes to recover the upfront costs - and the total lifetime savings. If your break-even is shorter than the remaining tenure, refinance. If not, stay put.
Enter your current outstanding balance and interest rate.
Enter how many months are left on the current loan.
Enter the new lender's rate, new tenure and processing fee.
See the EMI saving, total interest saving and break-even months.
The calculator computes the EMI on your remaining balance at the current rate vs the new rate over the new tenure. Multiply each EMI by the months and you have the total cost. The break-even is the number of months after which the lower EMI has paid back the upfront processing fee.
OldCost = OldEMI × MonthsLeft ; NewCost = NewEMI × NewMonths + Fee ; Savings = OldCost − NewCost
The calculator runs two parallel amortization paths. Path A continues your current loan at the current rate to maturity - total interest paid, total cost. Path B replaces your remaining balance with a new loan at the new rate, new tenure, plus processing fee paid upfront. Subtract path B from path A and you have the gross saving. Divide the processing fee by the monthly EMI reduction to get the break-even month.
Three factors drive a successful refinance: rate gap, remaining tenure, and outstanding balance. Rate gap matters most - a 0.5% reduction is the typical minimum for refinance to be worthwhile. Remaining tenure matters because the interest saving compounds over more months. Outstanding balance matters because processing fees are a percentage; on a ₹10 lakh balance the fee can wipe out the saving, while on a ₹70 lakh balance the same percentage is trivial relative to interest savings.
Top-up refinancing is a related option: borrow extra against the existing property while refinancing. The new lender consolidates your existing balance and the top-up amount into a single fresh loan. Useful for home renovations, education or medical expenses - top-up rates are typically 0.5-1% above the home-loan rate but much cheaper than personal loans.
Old EMI ₹41,151. New EMI at 8.5% for 15 years ≈ ₹39,378. Monthly saving ₹1,773. Processing fee at 0.5% = ₹20,000. Break-even ≈ 12 months. Total interest saving over the 15 years ≈ ₹3.19 lakh (after subtracting the processing fee). Clear win.
Old EMI ₹26,074. New EMI ≈ ₹25,491. Monthly saving ₹583. Processing fee ₹6,000. Break-even ≈ 11 months. Total saving over 5 years ≈ ₹29,000 after fees. Worthwhile but modest - the small remaining tenure caps the upside.
Generally when the rate gap is at least 0.5%, the loan has more than 3 years left, and the outstanding balance is over ₹15-20 lakh. Smaller balances or shorter tenures rarely save enough to cover fees.
It's the number of months your EMI savings need to add up to cover the processing fee. If break-even is 18 months and you plan to keep the loan for 7 more years, refinancing is profitable.
RBI prohibits prepayment penalties on floating-rate home loans for individuals. Fixed-rate loans may charge 2-4%. Check your loan agreement.
Yes, and it lowers the EMI. But the longer you take, the more total interest. The calculator lets you compare different tenure options.
Use both. Refinance to lower the rate, then keep prepaying to cut tenure further. Maximum savings come from doing both.
No. Section 24(b) and Section 80C deductions transfer to the new lender as long as the property and loan purpose remain the same. The refinance bank will issue the interest certificate going forward.
Indian financial products - home loans, fixed deposits, mutual funds, NPS, insurance - each carry their own quirks: monthly reducing balance vs flat-rate interest, quarterly vs monthly compounding, indexation on capital gains, the choice between the old and new tax regime. We design every finance calculator to use the formula that an Indian bank, AMC, or insurer would actually use, and to surface the assumptions in plain English so you can audit the result against your own statement.
Use this calculator alongside the EMI, SIP and inflation calculators to plan your money holistically. A standalone EMI number means little until you compare it with your in-hand salary, your existing debt-to-income ratio, and the impact of inflation on the real cost of the loan. The related-tool grid below makes it one click to chain these analyses together.
The Refinance Calculator is part of the Finance suite on Online Calculator Tools, alongside 6 related calculators. All tools share the same UI patterns, the same privacy-first rendering (nothing is sent to a server), and the same commitment to showing the formula and assumptions behind every result.
