THINKING OF REFINANCING?

Interest rates are nice and low, and rumor has it they may be headed lower still. So is now the right time to refinance?

That depends a lot on your circumstances, including what you owe on your house, when you last refinanced, your future plans for your house, and your current interest rate. Even back when the market was flush, I had clients who'd refinanced so often that they were upside down in their home, not to mention what they'd dished out in refi closing cots.

One of your first considerations should be what you owe on your current mortgage versus what your house is worth in today's market. In most cases, the bank will require you to purchase an appraisal as part of the refi process. That will set you back $300 to $600, depending on where you live and the type of financing you're using. Different programs require different forms, with appraisals for federally subsidized programs (actually, it's the mortgage insurance or loan guarantee that's subsidized) requiring lengthier forms that take more time for an appraiser to complete.

Is there any advantage to requesting the last appraiser who valued your house when you're getting a refi appraisal? If your most recent appraisal was in the last year or two, you might get a price break. Or you might not. It depends on your market, the individual appraiser, and whether the form is the same or different. And lenders aren't as lenient as they used to be about letting home owners choose appraisers. You may find the appraiser has been selected for you.

In any event, appraisers typically share data from their previous appraisals, so in theory they should all come up with roughly similar values for your house. But appraisal is an art, not a science. If you do have a choice of appraisals, folks in the industry may offer some suggestions as to which appraisers are most conservative or generous.

I prefer middle-of-the-road appraisers, those with reputations for fair and accurate valuation. A generous appraisal might sound nice up front, but no one wants their plans dashed down the road when they discover what they thought their house was worth is actually an inflated value.