Cost-Benefit Criterion
“Quitting smoking is easy. I’ve done it lots of times.”
OK, so refinancing isn’t completely painless — there are some fees involved, and some paperwork to fill out (natch).
But, the operative question to ask 
isn’t, “how long has it been since I refinanced?” or even “how much will it cost?”
Rather, it’s “do the benefits of refinancing (again) outweigh the costs?”
Interest Rate Arbitrage
If you haven’t been watching the stock market or interest rates, both are swooning now in reaction to rising strife in Greece and the Euro zone generally.
When uncertainty rises, investors flock to supposedly safe investments like U.S. debt, driving down interest rates.
As of Friday, investors willing to lock up their money in U.S. 10-year bonds were being offered a paltry 1.70%, near all-time record lows.
Thanks, but no thanks.
The flip side of the latest crisis is another leg down in mortgage rates, from already ultra-low levels.
So, even homeowners who refinanced less than a year ago above 4% may very well benefit from refinancing again in the low-to-mid 3’s today (not a typo).
The key variable: how long you expect to be in your home.
Shopping for Rates
One more positive for would-be refinancers: if the funds for a purchase-money mortgage are late, the Buyer/Borrower’s closing may be blown, costing a whole lot more than any savings.
By contrast, there’s no such timing imperative once you already own a home.
So, it’s possible to consider online and/or out-of-state state lenders whose rates and fees may be more competitive (but whose service may suffer a bit).
P.S.: Dissatisfied (to put it mildly) with interest rates on your savings, but not willing to risk it in the stock market?
Here’s a thought: get a short-term ARM (3 or 5 years) at an unbelievably low 2.5% (or less), to at least partially offset the foregone interest income.
Call it “interest rate arbitrage.”
