Mortgage rates Reviewing the topic
Another common scenario is when the homeowner has an adjustable rate mortgage (ARM) and the interest rate on that mortgage "re sets" to a higher rate. If you think mortgage rates will continue to increase, replacing your adjustable rate with a new fixed rate mortgage will keep you from paying higher interest costs when the rates go up. Conversely, if you anticipate a decrease in rates in the future, applying for a new adjustable rate mortgage may be a better idea. If you are having difficulty paying your monthly mortgage costs, mortgage refinancing will not only extend the duration of the loan, but will reduce your monthly payments as well. Keep in mind though that while this will help you out of a financial trouble spot, you will actually be paying more total interest for the duration of the loan.