Low mortgage rates are enticing more homeowners to apply for a mortgage refinance. Mortgage loan application volume rose 13% for the week ended Aug. 13, 2010, compared with a week earlier, according to the Mortgage Bankers Association (MBA). The MBA’s Refinance Index jumped 17% from the previous week.

Many homeowners are jumping at the chance to refinance as the 3o-year fixed-rate mortgage has fallen to an average of 4.6% and 15-year home loans are at 3.99%. With rates so low, here are a few things to consider if you are trying to decide whether or not to refinance.

• How long will it take to recoup any closing costs associated with refinancing? The longer you plan to stay in your home after refinancing, the better off you’ll. Have your mortgage broker run the numbers to find the break even point for refinancing.
• Do you have an adjustable-rate mortgage (ARM)? There are plenty of people out there who still have ARMs that are scheduled to reset at a higher rate at some point. Mortgage rates are low now, but think about whether or not you’ll be able to afford the monthly payments when rates start to climb again.
• Do you have enough home equity to refinance? It doesn’t matter how low mortgage rates are if you are underwater on a home loan. Unless you qualify for the government’s program to help distressed homeowners — which has had lukewarm results — it will be tough to get a mortgage lender to approve a refinance.

Even if you don’t qualify for a home refinance right now continue to make your monthly housing payments on time each month to avoid problems. Not only will you avoid foreclosure, but a as the housing market recovers you may find yourself in a better position to get approved for refinancing down the line.