Those who refinanced their mortgages a year or so ago, when interest rates averaged just below 5 percent for a 30-year fixed-rate loan, may be wondering whether it’s time to refinance yet again now that rates are at least a full percentage point lower.

Making sense of the story

• As of Thursday, according to Freddie Mac’s weekly survey, the average rate on a 30-year loan was 3.83 percent, down from 4.63 percent a year ago, setting a record low.

• According to financial planners, homeowners considering refinancing first should delve into their financial goals, specifically the length of time they plan to live in the home.

• Some homeowners decide it makes more sense to stay with their current mortgage, especially if the savings are small or they plan to move within a year or two. According to one financial planner, when homeowners refinance, they’re not building equity; they’re starting at the beginning of the amortization tables.

• Amortization schedules work like this: In the first few years, almost all of the payment goes toward interest, so the longer the homeowner has the loan, the more is put toward the principal.

• Those who refinanced in the last year or two don’t have to consider amortization tables, but they do need to know their equity position – and when refinancing would begin to pay off.

• To calculate that, start with a rundown of all the closing costs, then divide the closing costs by the amount expected to be saved on each monthly payment.

• Depending on the lender, most homeowners likely need to have at least 20 percent equity, and maybe a little more, if they want to wrap closing costs into the new mortgage.