• Make sure refinancing your mortgage is the right move by asking questions.home sweet home image by David Dorner from Fotolia.com
  
  The idea of refinancing your mortgage may seem attractive, but before you sign any agreements you should find out the answers to some of the more basic home refinancing questions. If you feel that you can get a better interest rate from refinancing then you may be able to lower your monthly payment on your mortgage. There are many things to consider before you refinance your home.
  
  

Is There an Interest Rate Requirement to Refinance?

• According to Bankrate.com, there is a perception among some borrowers that the interest rate on your new mortgage needs to be a certain amount of percentage points below your current interest rate before you will qualify. When refinancing a home the lender looks at things such as how long you have had your mortgage, what is left to pay and the value of your home. You do not need to have a lower interest rate on your new mortgage to qualify.
  
  

Do I Need Good Credit?

• No, you do not need good credit to refinance your home. A good credit score will help you to get a lower interest rate, according to Bills.com. You may be able to offset a low credit score with more money down at closing, or some other concession offered by the lender such as longer terms. Discuss your credit situation with your lender and see if you may benefit from waiting to refinance while you clean up your credit.
  
  

Can I Refinance with a Lender other than My Current Mortgage Holder?

• You can refinance with any company that you choose. You do not need to refinance your existing mortgage with your current lender. However, if your loan is in good standing with your current lender then it may be interested in keeping your business by offering you a good refinancing deal.
  
  

Can I Change My Mind?

• According to the Mortgage Professor, by federal law a borrower has three business days from the day the refinance agreement is signed to rescind it. If you plan on rescinding your refinance agreement, then you should contact an attorney immediately to get the process started. After the third business day the contract is binding to both parties.
  
  

How Do I Save Money by Refinancing?

• To save money by refinancing your home, it is important to refinance at a lower interest rate than your current home loan. A lower interest rate means less interest is paid by the conclusion of the loan. You are refinancing the remaining balance of your mortgage, which will be less than the original balance you started with. For example, if you started with a $100,000 mortgage and have paid $20,000 toward your principle, then you would be refinancing the remaining $80,000. The lower amount of principle coupled with the lower interest rate will make a lower monthly payment for you.