Student Loan Refinance Calculator

What this calculator does

Student loan refinancing is a trade: a private lender may offer a lower rate or a cleaner payment, but federal borrowers can lose federal repayment and relief options. Enter the current balance, rate, and payment beside a proposed refinance offer. ToolGrym reports the new payment, monthly savings, fee break-even point, and the lifetime interest difference.

The result is a mathematical comparison, not a recommendation to refinance. For federal loans, read the warning below the result before treating a lower rate as a better deal.

How the math works

The new loan uses the standard amortization payment formula:

M = P x r(1 + r)^n / ((1 + r)^n - 1)

where P is the refinanced balance, r is the monthly rate, and n is the number of monthly payments. The calculator then computes:

• Monthly savings = current payment - new payment
• Break-even months = refinance fees / monthly savings
• Lifetime savings = interest remaining on the current loan - interest on the new loan - fees

The current-loan interest is simulated from the balance, current APR, and payment you enter. If your current payment is too low to cover monthly interest, the comparison cannot produce a payoff date.

Worked example

Suppose you owe $35,000 at 6.53% and pay $398 per month. A lender offers 5.25% for 10 years with no refinance fee:

• New payment: about $375 per month
• Monthly savings: about $23
• Interest saved: roughly $2,700 if both loans finish on schedule
• Fee break-even: immediate when fees are $0; with a $500 fee, about 22 months

That apparent savings is not the whole decision for a federal borrower. A private refinance could remove income-driven repayment, federal deferment, and future federal forgiveness eligibility. Run the math, then compare the value of those protections to the savings.

Federal versus private loans

Federal loans have program rules that change over time, and eligibility depends on the loan type and borrower. A private refinance is a new private obligation; it does not inherit federal benefits. The student loan calculator models a fixed repayment schedule, while the how student loan interest works guide explains daily interest and capitalization.

Use official Federal Student Aid and CFPB pages for current program eligibility. ToolGrym does not estimate forgiveness, income-driven payments, or lender approval odds because those outcomes depend on facts outside a fixed amortization model.

Common mistakes

1. Comparing payments without comparing terms. A 20-year refinance can lower the payment while increasing total interest. Test the same remaining term when you want a clean rate comparison.
2. Treating a federal loan like an ordinary private loan. The lower private rate may be worth less than income-driven repayment or a forgiveness path for your situation.
3. Leaving fees out of the comparison. Origination, application, and other charges delay break-even. Enter every known fee or test a conservative estimate.
4. Assuming a quoted rate is guaranteed. Lenders price rates using credit, income, debt-to-income ratio, term, and other underwriting inputs. The calculator uses the rate you enter; it is not a quote.

Internal links and next steps

Compare the fixed schedule with the student loan calculator, model extra payments with the loan payoff calculator, and compare a broader refinance decision in the refinance calculator. If the refinance would change your debt-to-income ratio, check the DTI calculator before applying.

Methodology and review

The calculator uses monthly amortization and treats payments as end-of-month payments. It assumes a fixed APR, no prepayment penalty, and no future capitalization event. Results are estimates for education and planning, not tax, legal, lending, or financial advice. Reviewed July 20, 2026.