Are the rising costs of energy, taxes, and insurance strangling your budget? If it is becoming increasingly difficult for you to make ends meet each month, there are steps you can take to improve your cash flow by refinancing your mortgage. Many people will tell you not to refinance your mortgage when interest rates are rising; however, if you need to lower your monthly payment or have an adjustable rate mortgage and want to stop your payments from going up, refinancing may be your only option. Rising interest rates does not mean you should not refinance, just that you need to refinance smartly.

Lowering your monthly mortgage payment is not without risk. When you pay less each month the mortgage lender is still going to collect their interest on the loan; the lower monthly payment comes from paying less principal back. Lowering your monthly payment means you will pay more to finance your home, a necessary trade off for many homeowners feeling the pinch of a declining economy.

There are three ways to lower your monthly mortgage payment. To accomplish this you can refinance to mortgage with a lower interest rate than you are currently paying, choose a mortgage with a longer term length, or downsize your home. To learn more about your mortgage refinancing options, including common mortgage mistakes to avoid, register for a free mortgage guidebook.