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Will refinancing help lower my mortgage payment?
Our financial situation has changed and we're now struggling to make our mortgage payment. We're about 10 years into a 30 year loan. Interest rate is something like 4.7% If we refinance, will that lower our mortage payment?
Asked By Walter | Cleveland, OH | 222 views | Finance Legal Info | Updated 5 months ago
Answers (4)
Amanda Courtney
REP Realty Group
If rates are lower than when you bought, or if you’ve improved your credit score, refinancing can reduce your monthly payment. You can also extend the loan term to ease payments, but it’s best to weigh that against the total interest paid over time.
- 5 months ago
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Jason Craig
Coldwell Banker
Refinancing can lower your payment, but it depends on both the interest rate you obtain and the term you choose. When you refinance you are essentially taking out a new loan to pay off the old one. If current rates are significantly lower than your 4.7% and you have good credit, you could refinance to a lower rate, which would reduce the interest portion of your payment. You could also stretch the loan back out to a fresh 30‑year term, which would lower the monthly payment because it spreads the remaining principal over a longer period. The trade‑off is that you would be starting over on the amortization schedule and could end up paying more interest in the long run.
You also need to factor in closing costs, appraisal fees and any points. These add to your loan balance or require cash up front. A good lender will show you the new payment, total cost of the loan and the "break‑even" point where your monthly savings exceed the costs. Sometimes a 15‑ or 20‑year refinance at a much lower rate keeps your payment similar but saves you tens of thousands in interest.
If your financial stress is temporary, speak with your current lender about a modification or forbearance program before refinancing. If you intend to stay in the home long enough to recoup the costs and the new rate is low enough, refinancing can be a good tool to lower your monthly payment. Shop with several lenders, ask about closing costs and compare the overall savings before you commit.
You also need to factor in closing costs, appraisal fees and any points. These add to your loan balance or require cash up front. A good lender will show you the new payment, total cost of the loan and the "break‑even" point where your monthly savings exceed the costs. Sometimes a 15‑ or 20‑year refinance at a much lower rate keeps your payment similar but saves you tens of thousands in interest.
If your financial stress is temporary, speak with your current lender about a modification or forbearance program before refinancing. If you intend to stay in the home long enough to recoup the costs and the new rate is low enough, refinancing can be a good tool to lower your monthly payment. Shop with several lenders, ask about closing costs and compare the overall savings before you commit.
- 5 months ago
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Meredith Kronenberg
Howard Hanna
Refinancing can lower your mortgage payment — but it depends on a few key factors.
Refinancing typically helps if one or more of the following apply:
📉 Lower interest rate
If current rates are lower than your existing rate, refinancing can reduce your monthly payment by lowering the interest portion of the loan.
🗓 Longer loan term
Extending the loan term (for example, going from a 20-year loan back to a 30-year loan) can lower the monthly payment — though it may increase total interest paid over time.
💳 Removing mortgage insurance
If you now have enough equity to eliminate PMI or MIP, refinancing can reduce your payment even if the rate change is small.
🏡 Improved financial profile
Higher credit score, increased income, or lower debt can help you qualify for better loan terms than when you originally purchased.
When refinancing may not help
Refinancing may not make sense if:
Current interest rates are higher than your existing rate
Closing costs outweigh the monthly savings
You plan to sell the home in the near future
Important to remember
Refinancing isn’t just about the monthly payment — it’s about the overall cost of the loan and how long you plan to stay in the home.
Bottom line
Yes, refinancing can lower your mortgage payment, but it’s not automatic. You should talk with a local lender to see if it makes sense for you and your situation.
Try with Free and Go, or enjoy 2x rate limits on all other plans for a limited time.
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Refinancing typically helps if one or more of the following apply:
📉 Lower interest rate
If current rates are lower than your existing rate, refinancing can reduce your monthly payment by lowering the interest portion of the loan.
🗓 Longer loan term
Extending the loan term (for example, going from a 20-year loan back to a 30-year loan) can lower the monthly payment — though it may increase total interest paid over time.
💳 Removing mortgage insurance
If you now have enough equity to eliminate PMI or MIP, refinancing can reduce your payment even if the rate change is small.
🏡 Improved financial profile
Higher credit score, increased income, or lower debt can help you qualify for better loan terms than when you originally purchased.
When refinancing may not help
Refinancing may not make sense if:
Current interest rates are higher than your existing rate
Closing costs outweigh the monthly savings
You plan to sell the home in the near future
Important to remember
Refinancing isn’t just about the monthly payment — it’s about the overall cost of the loan and how long you plan to stay in the home.
Bottom line
Yes, refinancing can lower your mortgage payment, but it’s not automatic. You should talk with a local lender to see if it makes sense for you and your situation.
Try with Free and Go, or enjoy 2x rate limits on all other plans for a limited time.
Download for macOS
- 1 month ago
- Helpful (0)
- Unhelpful (0)
Gale Culver
Real
Based on current interest rates you would likely have a higher interest rate if you were to refinance. You could essentially start your 30 year loan over which could lower your payments, but you would likely end up paying significantly more in interest by going that route.
- 4 months ago
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- Unhelpful (0)
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