The current ‘rule of thumb’ is that if you are able to negotiate even a 1% reduction in the interest rate on your mortgage, it is worthwhile provided that you can absorb the penalty costs. In that way, you will be able to reduce your regular monthly payments.
However, if you maintain your pre-refinancing monthly payments (even though the rate reduction will require a smaller payment), you will increase the equity in your home more quickly.
But exercise caution if you plan to refinance your mortgage to paydown mounting debt.
If you simply translate the amounts you owe on high-interest credit cards and mid-interest lines of credit to the lower-interest mortgage, once you pay off the legal costs and penalties and are faced with higher monthly payments on the mortgage, you may well find yourself facing newly mounting debt.
It can be a vicious cycle that you may want to address with the lawyers at M. G. Michaels & Associates for options other than mortgage refinancing.