When Should I Refinance My Mortgage?

When interest rates fall, it's a good time to refinance your mortgage. In this case, you can find another loan with a similar monthly payment as your current loan, but repaid over a much shorter period. It can also be useful to convert to an adjustable-rate mortgage from a fixed-rate loan when rates will continue falling, as your rate may decrease with the market.

Generally, you should consider refinancing whenever it can help reduce your monthly payments, shorten the time it takes to repay your loan, or both. Remember that every mortgage includes closing fees, so you should wait to ensure the benefits you gain from refinancing will be more than enough to justify paying these expenses.