It's anyone's guess what interest rates might do in the next 3, 6 or 12 months, but rates continue to be historically low.  Given these low rates, you may be considering whether it would be worthwhile to refinance.

Here's a sample analysis of whether "Bob" should refinance, that might be helpful as you analyze your own scenario.  Here's what you need to know about Bob....

• Home Value = $275,000
• Original Mortgage = $212,500 @ 7% for 30 years
• Current Balance = $200,000 (after five years, thus 25 years remaining)
• Current Payment = $1,414/month (principal & interest)
• Refinance Opportunity = 6.25% with a fee of $2,500

If Bob refinances for $202,500 (including the refinance fee estimate of $2,500), his new payment will be only $1,247/month.  This means that it will take only 15 months for the savings to have added up to the cost of the refinancing process.  ($2,500 divided by the difference in monthly payments)

One important note --- Bob lowered his payment by $167/month by refinancing not only because he lowered his rate, but also because he extended his remaining loan term from 25 years back up to 30 years. 

So, bottom line...

• Can refinancing your mortgage lower your monthly payment?  Absolutely!
• Can you recoup the cost of the refinancing process?  Absolutely!
• Should everyone refinance if the current rates are lower, or if it would lower their monthly payments?  Not necessarily! 
  

If an analysis of your current finance/refinance scenario would be helpful to you, please let me know.  I can either walk you through some of the basic calculations, or put you in touch with a qualified lender who can.