Getting a new loan with a shorter term or a lower interest rate should save you money. However, these savings can play out in different ways. A shorter loan term, for example, can save money in total interest paid to the lender over the life of the loan. But the shorter repayment period typically requires higher monthly mortgage payments. Also, most refinance loans require closing costs which normally add about 2-5 percent of the loan amount due upfront. You should measure these costs against the savings your new loan can provide. A refinance calculator can help you compare these current costs and ongoing savings.