Should you refinance?

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With fixed-mortgage rates hovering near 5 percent, now is a good time to refinance. If you're under water on your mortgage—you owe more than your home is worth—you won't be able to do that. But if you have sufficient equity in your home as well as great credit, you're a prime candidate. Expect to pay for an appraisal and face strict documentation requirements.

In this chaotic housing market, it pays to shop around for a lender. Jack Guttentag, a professor of finance emeritus at the Wharton School who runs a Web site on home mortgages, says there can be a 1 percentage point difference in rates from the highest-priced lender to the lowest-priced and 0.25 percentage point swings in the market day to day. When comparing mortgage offers, be aware that lenders might offer you their best possible rate when you first contact them, then quote a higher rate when you apply. Any rate you're offered can change quickly, so if you get a great quote, lock it in that day.

For lists of lenders in your area and calculators that reveal how much money refinancing could save you, go to HSH.com or Bankrate.com. Explore not only large lenders but local banks and credit unions, which sometimes have the best deals.