Cash needed at closing and the cost of refinancing are not always the same number. Sorting the line items helps you avoid counting a fee twice or treating a refundable deposit as a permanent cost.
Start with the written breakdown
Ask the lender to identify origination charges, points, appraisal and title costs, government charges, credits, prepaids and escrow funding. The CFPB Loan Estimate explainer describes the form’s cost sections.
Do not copy the whole cash-to-close figure into the refinance-fee field without understanding its components.
Split fees by how you pay them
- Paid in cash: Refinance fees you pay separately from the loan.
- Financed: Refinance fees added to the new loan balance.
If a hypothetical refinance has $5,000 in net fees, with $2,000 paid out of pocket and $3,000 financed, enter $2,000 in cash-paid fees and $3,000 in financed fees. Do not put $5,000 in both fields.
The financed portion increases the starting debt in our model. Its cost is reflected in loan payments and debt remaining; it should not also be added as a separate cash fee.
Keep escrow and recurring expenses separate
Escrow money is held to pay expenses such as property taxes and homeowners insurance. Funding a new escrow account may increase cash needed at closing, while money in the old account may be refunded separately. A deposit that is refundable or later used for an expense you already owe is not simply an additional refinance fee.
Prepaid interest and the timing of tax or insurance payments can still affect cash flow. The simplified calculator does not model detailed closing-date adjustments, escrow refunds or every prepaid expense. Ask your lender or settlement agent to separate those amounts.
Check credits and no-cost language
A lender credit may offset some charges. Confirm which fees it covers and how it affects the offered rate. Enter net fees after applicable credits, counting each credit once.
A fee added to the loan has not disappeared. A rate-and-credit tradeoff also needs its own comparison. Ask for a complete breakdown instead of assuming a no-cost label means the transaction has no financial cost.
Check the payoff amount
Your current balance may differ from the lender’s payoff quote because of interest through a specified date or other amounts due. This calculator starts with the balance you enter and is not a closing worksheet. It does not model cash-out proceeds or debt consolidation.
Compare fees and payments using documented assumptions. Review the methodology for exclusions and compare actual lender documents before proceeding.