The number one downside to refinancing is that you will incur some additional costs with both the appraisal fee and the legal fees associated with discharging and registering the new mortgage. These costs are typically offset with lower interest rates and lower monthly payments of a mortgage when comparing to carrying unsecured debts, loans or credit cards. The next downside to refinancing to pay off other debts is the amortization you choose. If you keep adding additional funds to your mortgage, extending out the amortization and reusing those credit facilities, you could end up paying more in the long run. Setting your mortgage terms to your financial goals is important.