If you decide to refinance your existing mortgage it simply means that your are trying get another loan to repay the existing one. In a nutshell you want to replace the current loan and if it is from a different lender than the lender of course would be replaced. There could be many reasons one may chose to replace the existing loan. The net result of all the reason would be just to save money or to save more money. When you change the mortgage it may change the cost and lower down the interest rate than you might be paying on the existing loan. Also there could be a reason like you want to change the type of the interest rate by switching from the current adjustable interest rate to a new fixed rate interest loan. This is a yet another method to save money. Also you may have decided to increase the duration of loan while applying for refinancing.
It is often observed that people do get the amount of money doubled by accruing the interest rates on their mortgages. So a slightly lower rate of interest would be looked at as a big ray of hope and one may think of switching on to it to save money .  In a longer run it could amount to thousands of dollars. As a borrower you should check all the terms and conditions carefully. There could be harsh penalties that you may be required to pay if you break the contract in between. The intention of these penalties is to discourage a borrower if he ever plans to change the lender. If you refinance you may still see that it paid in the longer run.
This is quite obvious that you may want to refinance only if you need money and you are not satisfied with the current terms and the rate of interest that you are paying. You would want to save more and reduce the cost incurred by the interest that you pay on the amount borrowed. Changing the mortgage to a different lender with lower interest rate would help. There are some costs involved when you go for refinancing, however as mentioned earlier you will find that you have save a lot in  the longer run. A change in your mortgage structure would help you save a lot.
When you opt for refinancing the fixed rate longer duration deal is always advised. The interest rate charged might seem higher as compared to the adjustable ones however when you have to consolidate your credit and improve your scores you need to have a definite monthly payment plan which you should be able to budget in advance. The fixed rate refinance is the best option here.
Among the things that you need to consider when you go for refinancing is the time for which you might be planning to live in the house that you are going to use as collateral for refinancing. Any changes in the plan and if you decide to sell you house before you have paid off the loan may result into the consequences which might not be in your favor.