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Refinancing your mortgage can feel like a quick win — especially when interest rates drop. But here's the catch: **extending your loan back to 30 years for a slightly lower payment can actually cost you thousands in the long run**. Let’s walk through a concrete example.

- Original loan: $300,000 - Term: 30 years - Interest rate: 6.5% - 5 years into the loan → 25 years remaining - Current P&I payment: **$1,896/month** Now imagine you have the option to refinance at 5.5% interest: 1. **Keep Remaining Term (25 years)** - P&I ≈ **$1,796/month** - Total payments remaining: $1,796 × 300 months ≈ **$538,800** - Interest remaining ≈ **$238,800** 2. **Reset to a New 30-Year Term** - P&I ≈ **$1,703/month** - Total payments: $1,703 × 360 months ≈ **$613,080** - Interest remaining ≈ **$313,080** By extending to 30 years, your monthly payment drops by $93. But over the life of the loan, you pay **$74,280 more in interest**. That’s almost $75k in “savings lost” for just a tiny monthly relief.

Let’s put it in perspective: In other words, chasing a lower payment now can cost you tens of thousands of dollars over the life of your loan — even at a lower interest rate.

- **Lower monthly payment ≠ savings**: Always look at total interest. - **Keep your remaining term**: Refinancing is usually smarter when you maintain the same remaining term. - **Think long-term**: A few dollars saved each month can pale in comparison to decades of extra interest. Small monthly savings are tempting — but equity and total interest matter far more than your short-term cash flow.

Use tools that compare refinancing options side-by-side. Enter your current loan details, term remaining, and new rate, and see how your payments and interest really stack up. Open Refinance Comparison Tool