First ask yourself what you hope to accomplish in the next ten years after the mortgage refinance. Do you intend on selling the house any time soon? Do you want to just get the mortgage paid off and be done with it? Or do you have some debt sitting around that you would like the mortgage refinance to include? Is this the home you intend to pass on to your children?

How you answer these may greatly change what you aim to do in a mortgage refinance. Take for instance, whenever you think you would like to sell the house will determine the kind of loan you may wish to get. If that selling date is, let us say, five years from now, you might want to consider a balloon loan as part of your mortgage refinance strategy so you can minimize your payments and let the sale of the house pay for most of your loan.

However, if debt consolidation or long term ownership is in your plan, then the kind of mortgage refinance that would be best for you might be more along the lines of a balanced approach. Instead of worrying about the money later, you would be better off making sure your mortgage refinance fits in your budget to pay everything off as soon as possible.

Either way, do your best to live well below your means. Remember that you still have to save up for retirement – and if you haven't managed to save a good sum for that yet, your mortgage refinance might be the best opportunity. You could get cash out of your mortgage refinance in order to invest in your retirement, or take the savings and invest it.

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