Q: I have 26 years left on a 30-year fixed-rate mortgage that was originally $232,000 at 5.625 percent. Does it make sense for me to refinance? When might it make sense to do so? Thank you!

A: If you can save money now (when you’re not that far into your 30-year mortgage), you should look at refinancing soon, especially if you can pay off your closing costs with the savings in less than a year.

My guess is that it won’t make much sense for you to refinance until interest rates fall below 5 percent, maybe 4.75 percent or 4.5 percent for a 30-year fixed rate loan. (Those are the interest rates you’ll get if you have enough equity in your property and if you have great credit.)

But if you do refinance, consider this your last loan for awhile. If you stay in your home until the mortgage has been paid off, you should save a tremendous amount of cash over the years.

One more thing to consider: if you’re sure you’ll live in the home for at least the next 7 years, you might want to consider buying down the interest rate on your loan.

While some lenders have raised fees to refinance a loan, the pricing structure they may have could allow you to pay up to one point (a point is 1 percent of the loan amount) to buy down the rate of your loan one-half or three-quarters of a point. That small difference may help you a lot down the line.

But you have to be committed to living in the home for a long time otherwise paying the fees to refinance and paying the points will be a waste of resources.

Jan. 19, 2009.