When you’re making the decision to refinance, there are several things to keep in mind.

First, if your current interest rate is significantly higher than today’s lowest rates, you may be able to roll your loan costs into your new mortgage and still get a lower rate than you have, thereby reducing your interest payments and lowering your monthly payment immediately.

Second, if you are planning to stay in your home for at least three to five years, it may make sense to pay “points” (a point equals 1 percent of the loan amount) and closing costs to get the lowest available rate.

And third, you can avoid laying out cash and still get a low rate by financing the points and closing costs in your new mortgage. Does that mean shouldering a lot of extra debt? Not necessarily. If you’ve had your current mortgage for at least three years, you’ve probably reduced your balance by several thousand dollars. So you may be able to include your closing costs in your loan and still end up with a mortgage that’s smaller than your original loan—with a lower interest rate and lower monthly payment.

You also may want to consider lowering the term of your loan to pay off your home sooner. This option may raise your monthly payment, but it could save you a substantial amount of interest over the term of the loan.

Another refinancing consideration is choosing a fixed-rate loan, which has an interest rate that is fixed for the entire term of the loan, as compared to a variable-rate loan, which has an interest rate that can increase or decrease based on the short-term indexes.

Contact Academy Mortgage to see if refinancing is a good option for you.