How the Refinance Calculator Works

A refinance pays off your current loan with a brand-new one, so the calculator runs the same amortization formula as above - M = P × [ r(1+r)ⁿ ] / [ (1+r)ⁿ − 1 ] - using your new loan amount, new rate and new term to project your new monthly payment, then compares it against what you pay today.

For a rate-and-term refinance the new loan amount is close to your current payoff balance; for a cash-out refinance it also includes the extra equity you're pulling out. Either way, the key question is your break-even point: closing costs divided by your monthly savings tells you how many months it takes before the refinance actually pays for itself.

California rules & 2026 figures that apply

• Sacramento County charges a documentary transfer tax of $0.55 per $500 of property value (about $1.10 per $1,000); properties within Sacramento city limits also owe the city's own transfer tax of $2.75 per $1,000 on top of that (Sacramento County Clerk-Recorder-Assessor, Documentary Transfer Tax FAQ). Refinancing does not trigger this tax or a reassessment - only a change of ownership does.
• Under California's Proposition 13, the base property tax rate is 1% of assessed value; with voter-approved local bonds and assessments layered on top, most Sacramento County parcels land at an effective rate of roughly 1.05%-1.3% (about 1.10% within Sacramento city limits) (JVM Lending, Sacramento Property Taxes 2026). Buying a home also triggers a one-time supplemental property tax bill once the county reassesses to the new purchase price.
• Typical debt-to-income (DTI) guidelines by loan type: conventional loans generally allow up to 36% DTI on manual underwriting, up to 45% with strong compensating factors, and up to 50% through Fannie Mae's Desktop Underwriter (Fannie Mae Selling Guide, B3-6-02). FHA commonly benchmarks 31% housing / 43% total DTI, and USDA benchmarks 29% housing / 41% total DTI, both allowing higher ratios with automated underwriting or documented compensating factors (Lower, DTI Limits By Loan Type). VA loans weigh residual income more heavily than a strict DTI ceiling.
• The 2026 FHFA baseline conforming loan limit for Sacramento County (1-unit) is $832,750, up 3.3% from $806,500 in 2025; CA high-cost counties top out at $1,249,125 (150% of the baseline) for 2026 (FHFA, 2026 Conforming Loan Limit Values).

Estimates only, not a commitment to lend. Figures above reflect publicly reported 2026 program limits and CA tax rules as of this writing and can change - confirm current numbers and your specific eligibility with one of our loan officers before making a decision. The Home and Commercial Loan Company, Inc. is an Equal Housing Opportunity lender, NMLS #1665729.