How do I determine if refinancing makes financial sense for my situation?

Before refinancing, evaluate your current interest rates compared to market rates, calculate closing costs (typically 2-5% of loan amount), determine your break-even point, consider your long-term housing plans, and check your credit score. Refinancing makes sense when your current mortgage rate is significantly higher than market rates, your credit score has improved since you took out the mortgage, you plan to stay in your home long-term, and the closing costs will be recouped through your monthly savings. It may not make sense if you plan to sell soon or if closing costs outweigh the savings.