When does it actually make sense to refinance?

I tell people that its usually not worth it to refinance till you can go down an entire point (1%). Run the break even monthly saving vs. refi costs if it takes too long to recoup then its not worth it yet. Just remember that real estate is a long game, think in decades not years.

The common manta was marry the home date the rate. This was based on the idea that interest rates would eventually go back to the lower levels we once witnessed during the "covid years". Even if the "Fed" drops rates it doesn't mean mortgage interest rates will drop. .5% lower could be where it stays for the next few years or it may start dropping as soon as there are changes at the Fed level. The thing you need to consider is the reset factor. You have paid a large amount of front loaded interest in the first few years of your mortgage and starting over will have you paying all of the front loaded interest again which in the long run may end up with you paying more interest over the lift of your loan than if you just stayed with your original mortgage.

I would say it really depends on if you need to refinance to pay off other debt that has high interest rate, then I would probably go forward if the interest rates only .5% lower than your current rate. Also depends on how much equity you have in your home. But let’s say you have really high credit card debt with high interest rates in the long run. You could be saving money if you ran the numbers.

Yes and yes! You just purchased your home. 2 years ago and .5% lower is still a change. Also have you spoken with a lender? Chances are since it's a refi, your interest rate might be slightly lower. At the moment the war has increased the interest rates, but I still recommend talking with a lender(s) to see what's the best rate you can get out there. Best of luck and always refi!