Define the specific goal
Possible goals include changing the term or rate structure, improving payment stability, accessing equity, removing a borrower, addressing mortgage insurance or using an eligible streamline program.
A useful comparison measures whether the proposed loan actually advances that goal.
Calculate a planning break-even period
One simple starting point divides the refinance costs by the expected monthly savings. That estimate does not capture every consequence, including a changed loan term, costs added to the balance or the time value of money.
Use the calculation as one input rather than a universal decision rule.
Look beyond the monthly payment
A lower payment can result from a longer repayment term, not only a lower borrowing cost. Compare balances, amortization, mortgage insurance, total closing costs and projected interest over the period you expect to keep the loan.
Review whether the refinance changes escrow funding, insurance assumptions or an existing second lien.
Consider future plans and uncertainty
Selling, moving, paying the loan off early or refinancing again can shorten the period available to recover costs. Variable income or planned household changes can affect the value of payment flexibility.
A mortgage professional can provide loan comparisons; individualized tax, investment or financial-planning questions belong with the appropriate qualified adviser.