Seeking reasons not to refinance

DEAR HARRY: I've been getting a lot of mail from mortgage lenders telling me that I should refinance my mortgage. I know that rates are much lower than my present rate of 5.75 percent, but I am leery of "starting over" with a new mortgage. I owe $184,000, and my home is worth about $170,000. We are in a desirable part of South Philly. There are some good reasons to refinance, but I wanted to know if there are any good reasons not to. We are thinking about having anther child, but that would make our home a bit crowded, so we may look for a more-accommodating home in the near future. I would deeply appreciate your thoughts.

WHAT HARRY SAYS: If you are going to move shortly, the interest savings could easily be eaten up by the costs of refinancing. That's important enough to make the rough calculations now. But most important is the fact that you're "underwater" on your debt. It won't be easy to find someone who will grant you a new mortgage with the value of the home about 10 percent lower than the loan. Anyone who does grant you the new mortgage will give it to you with fees and rates that are way out of line. It is possible that you can get a new loan by making a substantial principal payment to get the amount down under the home's value.