Refinance Your Mortgage: What You Should Know

First of all, a mortgage refinance isn't for everyone. If you're thinking about refinancing, you should keep the following in mind:

1. Do you have enough equity built up in your home to make it worthwhile to refinance?

2. How long are you planning on living in the house? If you're planning on moving soon, then it may not be a good idea to refinance at this time.

3. How much will your interest rate be? If it's not lower, you may end up with some quick cash in hand, but significantly higher monthly payments.

4. What are the closing costs going to be? If the closing costs are too high, you may not be saving any money when it's all said and done.

5. Before heading out to refinance, check out your credit score. Get a copy of your credit report and try to get any mistakes removed. If you've paid off a debt, write the credit bureau and ask to have it removed. The higher your credit score, the better the interest rate and terms you'll be offered.

6. If you do decide to refinance your home, compare offers from different lenders, just as you would if you were purchasing a car or any other large item. The lower your interest rate, the better. If you currently have an ARM (adjustable rate mortgage), it's definitely in your best interest to lock in a low-interest fixed rate loan.

To check and see if a mortgage refinance would be in your best interest, check out Bankrate.com's Refinance Calculator.