So nina… Since your original loan is 3.875 and your current loan is 3.375…

You have a few options. You could do the traditional refinance with no points/no cost and get the lowest rate… Or you can do what I think AN does and what Xboxboy does…

What they do is the get a loan with a slightly higher rate, but then the bank gives them back negative points. IE the bank gives them cash back today for taking the higher rate… It also make sense if you want to do something with the money (like invest it or such)….You’re in a nice predicament in that you have a .50% difference. So you can do both. You can get a lower rate, have total smaller loan balance, and get a negative point rebate…

For instance if you decide to refinance at 3.5%, your monthly payment will still be lower than your original loan, your total loan will be lower, and you will get some cash back too (albeit maybe not that much)…

Yes, nina… You can have your cake and eat it too. 🙂