Q: I own a second home in the North Georgia mountains on which I owe $46,000. I’m trying to sell the property for $126,500.

My current interest rate is at 6.25 percent. Would you suggest, if the second home doesn’t sell, that I refinance to a 5/1 adjustable rate mortgage or just refinance to a 15-year or 30-year conventional loan?

A: There are a couple of issues you’ll have to resolve before you can refinance. First, it’s getting harder and hard to find a lender who will refinance a loan with a balance of less than $50,000 or $75,000. It’s often not worth the trouble, and you may pay oversized fees relative to the amount you’re borrowing.

Think about it: If the costs to refinance are high, the savings on the new lower rate loan may not be sufficient to cover those costs.

In that same vein, if you’ve had this loan for awhile, and I’m guessing you have, refinancing may not make any sense. If you’re just trying to lower your monthly payment, then refinancing might do that. But, you’ll be paying more in interest over the long term. While a different loan will give you a lower payment, you have to remember that if you refinance, you will be extending the number of years of the loan. Those additional years of payment may add up to a lot more cash than you’re saving each month.

Right now, you’re probably paying more principal than interest. Refinancing would flip that ratio. Maybe it doesn’t matter much to you if it’s only for a few years, but I like property owners to fully understand the implications of a financial move.

Next, if your home is for sale, many lenders simply won’t refinance you until the property has been off of the market for at least six months and the lender is convinced you’re not going to sell quickly.

The reason is that when lenders resell loans to investors, the investors are buying a stream of income, whether it’s 18 months or 30 years. If your home is for sale, it’s a short-term loan, and typically lenders don’t make money initially on that investment.

Still, I’ve heard from several readers recently that lenders (particularly credit unions) are more open to doing these sorts of refinances. So, check around and see what’s available in your area.

The bottom line is what does it cost to refinance and what will you really save? Until you do your homework, you won’t know.