If you own and home and are paying a mortgage, it’s probably the biggest expense in your budget.

That means it’s also one of your biggest opportunities to save money.

Interest rates are near historical lows right now and if you haven’t refinanced recently then you can probably save a bunch of money with a refinance.

If you have a $160,000 mortgage and you are sitting there with a 5.5% loan, you’re paying $908.46 a month. If you can reduce that to 3.5% you’ll only pay $718.47 a month.

That saves you $189.99 every month. That’s almost $2,300 every year just by getting a new loan.

Even if you already have a pretty low rate of 4% you’d still pay $763.86. The refinance would save you $45.39 a month, or $544.68 a year.

If you can find a lower rate it might seem like a no-brainer, but don’t go running to sign the paperwork just yet. Fox Business reports that it doesn’t always make sense to refinance.

Understand the Closing Costs and Fees

When you refinance a mortgage there are usually fees associated with closing the loan. These fees can cost many thousands of dollars and might make the refinance too expensive.

If it costs $2,000 to close the loan and you’ll be saving $2,300 every year then as long as you aren’t looking to sell the house right away you should go through with the refinance.

However, if it’s going to cost $2,000 to close the loan and you’re only saving $544 a year, you might not want to go through with the refinance.

Ask the Bank to Pay Closing Costs

If you found a rate that’s substantially lower than your current rate but you don’t have the money for closing costs, you should ask the bank if they will raise the interest rate in exchange for them paying the closing costs.

You won’t save as much money each month, but if the closing costs are paid then you can’t lose with a lower monthly payment!

Shop Around for the Best Deal

When you are looking for mortgage loans you want to shop around as if you were buying a car or a new refrigerator. The first one you find isn’t always the best one.

Talk to local banks and credit unions. Look online for low advertised rates. Find out if your employer has a deal with a bank where you get preferred rates.

Make sure as you are shopping that you aren’t actually applying for the loan; each time you apply your credit will be run and it will slightly lower your credit score.

Once you’ve found the best rate, do the math and figure out if the next interest rate is low enough, if you will stay in the house long enough, and if the closing costs are cheap enough for you to get it done.