mortgage banker david dessner crunches these numbers for a living. he disagrees with the common rule of thumb that refinancing only makes sense if the rate falls by at least two percentage points. >> in many cases, you have customers refinancing for a half percent-- or five-eighths interest rate drop. >> reporter: he has a different way of evaluating whether refinancing makes sense-- figuring out return on investment. he gives an example of a borrower who could save $338 a month refinancing, but it would cost $5,000 to do so. >> $338 a month over a year is $4056. so essentially, you are getting an 80% return on your $5,000 investment. over the life of the loan, you are saving $109 thousand-- almost $110 thousand. >> reporter: for many people, there's also the question of whether to shorten the duration of the loan-- say, from a 30- year term to 15 years. >> the shorter the duration of the loan, the higher the payments are going to be, but the less interest you are going to pay over the life of the loan. a lot has to do with cash flow, affordability a