Mortgage Refinancing Math: Break-Even, Points, Cash-Out & ARMs
Decide a refinance from the borrower's side, number by number: the remaining balance with CUMPRINC and CUMIPMT, new payments by term, itemised closing costs and the break-even month, points vs lender credits, the term-extension trap in total interest, a cash-out refinance with its LTV and the true rate on the cash, ARM resets with index, margin and 2/2/5 caps, and a decision table ranking offers by NPV with a chart – 8 labs on one fictional household's loan, every cell checked instantly. Illustrative rates, educational only, not financial advice.
The first lesson is free — no account needed.
About this course
A mortgage refinancing course that decides one fictional household's refinance from the borrower's side, number by number in a spreadsheet, for homeowners, loan officers, financial planners and finance students. You find the remaining balance, the principal repaid and the interest paid four years in with CUMPRINC and CUMIPMT, price four new terms with PMT, add up the closing costs while leaving out the escrow deposit and find the break-even month with ROUNDUP, compare discount points with lender credits and find the cheapest offer over the stay, expose the term-extension trap in total interest, size a cash-out refinance against an 80% LTV limit and the true rate on the cash, run a 5/1 ARM through 2/2/5 caps and rank four offers by the NPV of their savings. Illustrative rates, educational only, not financial advice. The first lab is free.
Lessons
- Where You Stand: Remaining Balance with CUMPRINC & CUMIPMTFree
- New Payment by Term: PMT and the Monthly Saving Pro
- Closing Costs & the Break-Even Month Pro
- Points vs Rate: Buy-Downs, Lender Credits & Their Break-Even Pro
- Total Interest: The Term-Extension Trap Pro
- Cash-Out Refinance: New LTV & the True Cost of the Cash Pro
- ARM Reset Scenarios: Index + Margin, Caps & the Payment Path (Chart) Pro
- Refinance Decision Table: NPV of the Savings (Chart) Pro