Selling within a few years likely means you never recoup refinancing closing costs, making the break-even calculation essential before signing. It can lower your monthly payment, reduce your interest costs, or help you take advantage of your home's equity. Closing costs, loan terms, and how long you plan to stay in the house all play a role in whether refinancing makes sense. It Helps When Interest Rates Have DroppedOne of the most common reasons to refinance is to take advantage of a lower interest rate. Bet_Noire / Getty ImagesIt Helps When You Want a Lower Monthly PaymentEither refinancing to a lower interest rate or a longer loan term can reduce your monthly mortgage payment.