If you don’t already you should start. Regularly reviewing your financials including your real estate portfolio, that is. At least once per year, sit down with your financial adviser and review where you’ve been, where you want to go to make sure your current actions are in line with expectations.

As a real estate investor, you should review your current cash flow and find ways to cut back on expenses. And as interest rates have risen lately, have you reviewed your current interest rate? Should you refinance your existing loans for your properties? If not, you should.

The first question that pops up is simply, “I wonder what mortgage rates are right now?” And that’s a good start. But really it’s less about the rate and more about how much you’ll save on interest in light of the closing costs you’ll encounter when refinancing an existing loan. So the rate’s not important?

Of course the rate is important but it’s what the rate represents that’s key. For instance, you may have heard that it’s only a good idea to refinance if current rates are at least one percent below your existing one, or don’t do anything unless rates are two percent lower, and so on. But that’s not really the equation.

For example, say you have a small property with an $85,000 loan on it. The existing rate is 5.00 percent and you’re paying $456 per month. Now say rates drop one percent to 4.00. What’s the payment? $405, or $51 less. Now pull out a copy of your settlement statement when you closed on the property and look at the closing costs involved. Title insurance, appraisal, attorney…it’s a fairly big list. Now say those costs added up $4,000, a conservative estimate. Is paying $4,000 to save $51 per month a good deal? Probably not. You wouldn’t benefit from the lower rate until the 78th month.

Let’s look at a more expensive property with a loan amount of $500,000 and a rate of 5.00 percent. The mortgage payment is $2,684. A 4.00 percent rate gives a $2,387 payment, for $297 monthly savings. Say closing costs this go-round are $6,000. Is it a deal? Looks like it. You save nearly $300 per month in interest and you get your $6,000 back in just under two years.

When considering a refinance, pay attention to the rate but pay more attention to what the rate represents. Getting a loan costs money and you need to weigh the benefits with costs, just as you would with any business decision.