Will Refinancing My Mortgage Save Me Money?

Refinancing your mortgage can be a great way to save money. It involves taking out a new mortgage loan with more favorable terms, such as lower interest rates or monthly payments. This can result in lower mortgage costs overall and help you build equity faster. However, before considering it, you should weigh the pros and cons of refinancing.

What Is Refinancing?

Refinancing a mortgage loan means replacing a current mortgage with a new one. This is done in order to get a lower interest rate, access home equity, change loan terms, or consolidate debt.

There are various reasons people might choose to refinance, as well as various mortgage options available specific to one’s individual situation. It is important to consult with an expert financial advisor before deciding to refinance to ensure that the mortgage terms and fees are appropriate for one's circumstances.

Pros of Refinancing

The pros of mortgage refinancing include saving money on interest payments, consolidating debt, and even taking cash out of your home's equity.

Saving Money on Interest

Refinancing your mortgage loan can help you save a great deal of money. By shopping around and comparing mortgage rates, you can see if refinancing is the right choice for you.

Refinancing gives customers the opportunity to take advantage of lower mortgage interest rates or change their loan terms. It essentially allows you to access better mortgage terms than those currently in your loan agreement—the goal is to reduce overall interest payments and create greater financial security. Therefore, refinancing is an important option for many homeowners who are looking for ways to maximize their savings and improve their financial standing.

Consolidate Debt

Refinancing a mortgage loan is an excellent way to consolidate debt. Not only does it allow homeowners to combine multiple outstanding loans and credit cards into one conveniently packaged mortgage, but it can also significantly reduce the amount of interest paid over the life of their mortgage.

By tapping into equity and consolidating monthly payments, homeowners can reduce the risk associated with fluctuating interest rates while making repayment significantly more manageable. Additionally, mortgage refinancing may provide the opportunity to extend repayment periods or take out additional funds to pay off high-interest loans such as auto loans or student loan debt.

However, it’s important to speak with a financial advisor before proceeding down this path, as mortgage refinancing does come at a cost - namely, closing costs and other fees - and may not always be financially advantageous for all scenarios.

Taking Cash Out of Your Equity

Refinancing your mortgage loan can be a smart way to make use of the equity built up in your property. By taking out a larger mortgage loan, you can tap into the value that's been created in your home and use it for things like renovations, college tuition, or just to pay off other debts.

Refinancing allows you to spread out your mortgage payments over a longer period, potentially lowering your monthly mortgage payment while increasing the amount of cash you can access from your home's equity. It's important to consider the rates and terms associated with any new mortgage loan before committing to refinancing to get the best deal available.

Cons of Refinancing

The cons may include higher closing costs than the original mortgage and an extended loan term due to reduced monthly payments.

Higher Closing Costs

Refinancing your mortgage loan can be a great way to save money in the long run, but it can also lead to higher closing costs than the original mortgage. Many lenders will charge additional fees for mortgage refinance, such as appraisal or inspection fees or points.

Longer Loan Term

A potential disadvantage of refinancing a home mortgage is that you may end up with a longer loan term than your current mortgage. This means you’ll be making payments for a longer period of time and will ultimately pay more interest over the life of the loan.

You May Not Save Money

Even if you get a lower interest rate when you refinance, there's no guarantee that you'll save any money in the long run. That's because while your monthly payments may go down, the total amount of interest you'll pay over the life of the loan will likely go up.

So before you refinance, make sure you crunch the numbers to see if it makes financial sense for you.


Refinancing your mortgage can be a great way to save money, but it's important to understand the potential risks and benefits before taking this route. Doing research, consulting with mortgage experts, and using a mortgage refinance calculator can help you make the best decision for your mortgage needs.

If you would like to find out if refinancing is right for you, contact us at MortgageWorks today. We are always ready to answer any questions you may have. Call or email today: (760) 883-5700 art@mwloan.com


MortgageWorks offers financing for new home purchases, refinance, home equity, investment property, construction, and a wide variety of loan program options to fit your every need.

Servicing the state of California and the entire Coachella Valley, including Palm Springs, Cathedral City, Rancho Mirage, Indian Wells, Palm Desert, Desert Hot Springs, La Quinta, Indio and Coachella. Call Art today @ (760) 883-5700

* Specific loan program availability and requirements may vary. Please get in touch with the mortgage advisor for more information.