Low balance loan may be difficult to refinance particularly when you have had the loan for some time.

Q: I owe $58,000 on a conventional loan that has 11.6 years left. I was wondered if it is a good time to refinance or should I keep what I have. My interest rate is 5.7 percent. Is it worth putting $2,000 in closing costs to refinance the loan or is there a better program the government has that I should look into.

A: If you started with a 30-year loan and only have about 11 years left on the loan term, your loan payments are about evenly split between the interest you pay to the bank and the repayment of principal.

If you still want to end up paying off your loan in about eleven years, you might find a 10- or 15-year loan at about 3.25 percent interest rate. On the balance remaining on your loan you might reduce your loan payment by about $40, but it would take you about four years or so to recover those costs.

In some ways, it might be a savvier move if you used those same funds to pay down your debt. You’d effectively end up shortening the length of your loan and saving a significant amount of cash.

The reason you don’t benefit as much from the lower interest rates is that your loan balance is quite small so the closing costs affect you to a greater degree. If you can work with your mortgage lender to refinance the balance you owe and give you a lower interest rate but charge you little if anything to refinance by paying a bit more on the interest rate, you might benefit by refinancing.

Just remember, if you do refinance and you take out a loan that extends the term of your debt (say, a 15-year mortgage) and you’d like to be debt free on your home in 11 years or so, you’ll have to pay additional amounts monthly.

Those additional payments will seem like you’re paying more than you should, but if you don’t want to increase by thousands of dollars your payments to the lender, you’ll want to pay off the loan in the same 11 years that you still have left on your current loan.