The first question that you should ask yourself is if you have the cash on hand to pay the fees. Depending on the amount of your mortgage, and the specific fees that your lender will charge, you could pay anywhere from a couple of hundreds dollars to a few thousand. Be sure that you’re financially ready for the move before applying for the loan.

Next, you should take a look at the current interest rates compared to the ones on your existing mortgage, and then decide whether or not a refinance would help your situation. For example, if you have an ARM mortgage, and the interest rates are at an all-time low, you might want to refinance your loan and turn it into a fixed rate so your payments won’t go up again as rates rise. In addition, if you have a fixed rate, but bought your home when interest rates were higher, you might want to refinance in order to lower yours.

If you find yourself with a lot extra debt, you could take advantage of a cash-out refinance loan. With this type of loan, you add on an amount to your home loan, refinance the entire thing at a lower interest rate, and then take the “extra” money out and pay off your debt. This will allow you to reduce the amount of debt you owe (because the interest rate will be lower), and at the same time, reduce the amount of the monthly payment.

Most experts agree that you shouldn’t go to the trouble or expense of refinancing your home if you don’t intend to stay in it for at least three years. Otherwise the cost of the process would likely be more than the overall savings.