Refinancing is becoming a hot topic these days with the rising interest rates, sluggish housing markets and increased number of foreclosures.  If you’re thinking about a refinance, here’s a few things to consider:

-Why do it?  Well for a couple of reasons.  You may have a variable interest rate loan and be concerned that your rate will raise your payments higher than you can afford to make.  Another reason would be to use the home equity to pay off outstanding debts like credit cards or student loans.

-Is it worth it?  Well, if you plan on moving out of your home in the next year or two, probably not.  You’re more likely to lose money in those instances.  But if you’re planning on lengthy stay, the money you’ll save will compensate for any closing costs.

-Shop around for rates.  Check with different banks and lenders, asking about their rates and terms.  Also ask your current lender about their rates and terms.  They already have business with you and would like to keep it, so they are very likely to offer you favorable terms, especially if you let them know you’re shopping elsewhere too.  Sneaky, but effective.  With the housing markets slowing down, competition for new loans is keen and the lenders know it.

Most important for you to know is that nothing is final until you sign on the dotted line.  Do your research and make an informed decision.