If the past is prologue, millions of homeowners with high-rate mortgages won’t refinance their loans, even as mortgage rates tumble.

Refinancing offers significant savings and can potentially improve your financial stability. Still, there are all kinds of reasons people don’t do it: Perhaps they no longer qualify for financing or can’t afford to close on a new loan. They might not know how to begin the process, or they don't want the hassle.

Then again, maybe they just aren’t paying attention to the fact that mortgage rates have finally started to fall. A year ago, rates hit a peak of 7.79% -- but by this September, they'd dropped to 6.2%.

Whatever the reason, previous cycles suggest that many borrowers eligible to refinance just don’t do so.

"Even as interest rates fell to historic lows in 2020 and 2021" -- a low of 2.65% in January 2021, to be precise -- "about 3.7 million mortgages (7.4%) still had interest rates of at least 6%," according to a report from the Consumer Financial Protection Bureau.

At today's rates, roughly 2.5 million borrowers are good candidates to refinance, says the CFPB. And if rates dip to, say, 5.5%, then over 7 million people could potentially refi.

Still, the fear is that too many borrowers will miss the boat again. To encourage people to refinance, the watchdog agency is exploring ways to streamline the process. Director Rohit Chopra says the agency is also working to curb the “exorbitant closing costs and junk fees” that make refinancing too expensive for many.

So, does it make sense for you to refi this time around? Here are some things to consider.

One rule of thumb is that it doesn’t pay to refinance unless rates have fallen by 2 percentage points or more. But now, with millions of recent homebuyers sitting on mortgages over 6%, it might make sense to take the step sooner. According to figures from the CFPB, someone who took out a $400,000 mortgage in October 2023 at 7.79% could have trimmed their monthly principal-and-interest payment by $427 had they refinanced at 6.2% in September.

The 1.59% slide in mortgage rates has already triggered a flurry of refinance applications. According to the Mortgage Bankers Association, refis accounted for 55.7% of all loan applications for the week ending Sept. 20 -- which was "175% higher than the same week one year ago," per a news release from the group.

Some borrowers will still sit tight, waiting for rates to fall even further, but there’s no guarantee that will happen. Indeed, some economists point out that the Federal Reserve’s rate cut was already baked into mortgage rates by lenders who expected it. And any future cuts from the Fed wouldn't necessarily decrease loan rates.

If you decide to refinance, know that it isn’t cheap. Generally, plan on spending roughly 5% to 7% of the mortgage amount on closing costs -- which may or may not include the cost of an appraisal, title search and application fees.

That’s a lot of cash, but many lenders will allow borrowers to roll those costs into the loan balance.

Then again, that may defeat the purpose of refinancing: With a higher balance, the monthly payments may not fall by much -- or at all. It’s doubtful that recent buyers have built up enough equity in their homes to give them much of a borrowing cushion.

It’s best to sit down with a mortgage broker or loan officer, work the numbers and make an informed decision.

One factor to consider is how long you plan to stay in your house. If it's only a couple more years, you won’t be there long enough to recoup your costs. But if you plan to remain longer, refinancing might make sense.

While you’re pondering all of this, make sure you can qualify for a new mortgage. Put your credit history in order: Don’t use more than 30% of the total credit allocated on your cards, and pay on time. Any late payments over the previous 12 months will be counted against you.

Check to see how much equity you have built up in your house since you bought it. For the most part, home values have been rising steadily in recent months, but in some markets, values have fallen. Mortgage companies generally won’t lend more than 80% of a home’s value, so if your loan-to-balance ratio is greater than that, you may not be a good candidate. That's especially true if you took out a second mortgage or used credit to get through the pandemic-induced economic downturn.

Still, check with a loan officer anyway; some lenders may be willing to proceed with a higher ratio if a borrower checks all the other boxes.

Lastly, make sure you have some cash on hand. Refinancing costs are significant -- expect to pay almost as much as you did to close the original loan. Even if you can roll some charges into your new loan, you'll still have to put some funds down.

Cash is king when it comes to buying a house. Always has been, and always will be. And these days, individual cash buyers -- as opposed to cash-laden investors -- have an even better shot of scoring the house of their dreams.

The share of investors currently trolling the resale market is at its lowest point since 2008, according to a report from the National Association of Realtors. And the National Association of Home Builders says all-cash sales in the new-home sector have also been trending lower.

Consequently, individual buyers now face less competition from investors -- and paying with cash gives them a leg up on buyers who must use financing.

Sellers like it when there is no mortgage involved: For one thing, cash allows for a quicker closing. An appraisal is not required, and no lender means there will be no lender-caused delays. All in all, there is less risk of something derailing a cash transaction on the way to settlement.

But there are downsides. Do you really want to empty your piggy bank, close out your retirement accounts and unload all your stocks and bonds, just to have all those assets tied up in a house?

You might, if there was a way to get your cash back in relatively short order. And that's possible with a technique known as delayed financing.

Delayed financing isn’t a kind of mortgage. Rather, it is a method for refinancing a cash purchase right after closing. Normally, homebuyers have to wait at least six months to pull money out of their deals. But with delayed financing, there is no waiting period.

The technique is particularly helpful in competitive markets in which bidding wars are common. Unfortunately, "not many people know about this program, and even fewer are using it,” says agent John Meussner of Fair Oaks, California.

When he posted about it on the ActiveRain real estate site in 2014, the response was “tremendous,” Meussner reports. “Comments like, ‘My lender didn’t know what I was talking about when I asked him about delayed financing’ were common,” he wrote in a follow-up post.

There are plenty of reasons you might want to retrieve some money out of your purchase. One is that houses are illiquid assets: It often takes months to buy and sell them -- unlike, say, stocks, which can be traded in seconds. Also, the money you used to buy your house cannot be used to make other investments. That goes against the adage that it's wisest to diversify your holdings -- to spread your money among different types of assets.

All-cash purchases also violate another basic investment tenant, which says it's best to invest with borrowed money, putting less of your own cash at risk.

Delayed financing pushes aside all these drawbacks. But as always, there are rules:

-- First and foremost, the refinanced mortgage has to be purchased from your lender by secondary market entity Fannie Mae. Check with your lender first to make sure that's the case.

-- Next, while there is no six-month wait to refinance, there is a six-month window in which you must do so. The window opens the day you close on your house and stays open for 180 days thereafter. If you miss the deadline, the opportunity is lost.

-- Refi now or later -- what’s the difference? In a regular refinance, the loan amount usually cannot exceed 80% of the home's value. But in a delayed financing, the loan amount can go up to the actual amount of your original investment in the property, as documented by the HUD-1 settlement statement -- plus whatever closing costs, prepaid fees and points you paid at that time.

That total, though, is subject to the loan-to-value ratio set for your new mortgage. And the loan amount cannot exceed Fannie Mae’s maximum loan limit, which changes yearly. Currently, that limit is $766,550 in most places, and about $1.15 million in high-cost markets.

-- Only your acquisition and closing costs can be financed under the delayed financing exception. Any costs incurred to renovate the property cannot be included. If you want to recoup those costs, as well as some of your original outlay, you’ll have to wait six months and apply for a standard cash-out refinance.

-- The purchase must have been an arm's-length transaction in which the buyer and seller both acted in their own individual interests.

-- The source of funds for your cash deal must be documented with bank statements, personal loan documents or a loan on another property you own. Any loans, including home equity lines of credit, used as a source of money for the purchase must be repaid from the proceeds from the delayed financing exception.

-- Gift funds can be used as a source of cash. But if the money Mom and Dad gave you must be repaid, it is not a gift; rather, it is a loan that must also be repaid from the delayed refi proceeds.

-- There can be no outstanding liens on the property, so make sure your taxes, insurance and homeowners association dues are paid up.

These days, disasters like wildfires, tornadoes, floods and hurricanes are more powerful -- and more frequent -- than ever. It’s increasingly likely that wherever you live, your home will be hit one way or another.

You already know it's crucial to be prepared for such an emergency, but what happens afterward is just as important.

The first step, per the nonprofit Consumers' Checkbook, is to assess your property and take any necessary steps to prevent further damage. If a falling tree put a hole in your roof, for example, put up a tarp as soon as it is safe to do so. Otherwise, subsequent damage to furnishings that were unscathed from the original event may not be covered by your insurer.

Next, take pictures or videos of the damage, whether it's the structure, your belongings or both. Capture how everything looks in the immediate aftermath before starting to clean and repair damaged items. Consumers' Checkbook advises people not to dispose of anything until an insurance adjuster has examined it, and to keep receipts for any expenses. Most policies cover those costs.

If you need help repairing your place, make sure you hire reputable contractors who don’t ask for cash up front. Before signing a contract, make sure the pros are licensed and bonded. If you have the time, check their references.

Beware of fly-by-night contractors who work out of their trucks, make hasty estimates and demand half the money in advance. These storm-chasers might do some work, but usually won’t finish -- instead, they'll hightail it out of town to the next disaster, leaving unhappy homeowners in their wake.

"Withhold as much payment as possible" until the job is done, advises a post on the Consumers' Checkbook website (checkbook.org). "If the repair work is extensive, the contractor may ask for periodic partial payments ... but no reputable contractor should request full payment in advance.”

After you’ve secured your house, call your insurance company to file a claim. Many insurers have disaster units that swarm into affected areas to help their clients when a calamity occurs. But be patient: They may be overwhelmed with customers in the area, and they tend to take the worst cases first.

When the adjuster shows up, the Insurance Information Institute (III) says, have a list of damaged items ready to show them, and point out any structural damage. To substantiate your losses, hand over any receipts that you still have -- just make copies of them first.

Be persistent, too. If your insurance company’s claims department seems to be moving too slow, call your agent to light a fire under the claims adjuster. If you still feel like you're getting nowhere, complain to your state’s insurance department. That office holds a lot of sway, and often resolves complaints in consumers’ favor.

Another option is to hire a private insurance adjuster. A private adjuster does the same job as the company’s, only they work for you. Many private adjusters once worked at insurance companies, so they know how to get through all the legalese to the heart of the matter. They'll take a cut of what your insurer eventually pays, but it may be worth that much -- and more -- to remove that burden from your shoulders.

Your next call should be to the company that collects your monthly house payments: usually a loan servicer. This outfit collects your payments, makes sure your insurance and taxes are paid and distributes the remainder to the investor who actually owns your mortgage.

Notify the servicer that your place has been severely damaged or is uninhabitable. Armed with that information, the company may be able to let you slide for a few months until you can move back in. All government-related agencies that touch mortgages -- Fannie Mae, Freddie Mac, the Federal Housing Administration, Veterans Affairs and the Rural Housing Service -- have rules about forbearance, and many private lenders follow their lead.

“The rules are essentially the same,” says Donna Schmidt of DLS Servicing, which provides loss mitigation and default services for investors. “If a borrower’s property or work was adversely impacted, the servicer may offer a forbearance period.” This period gives you some financial relief until you return to work or complete the repairs to your house.

During that time -- “usually about three months,” Schmidt says, “with extensions if necessary” -- the servicer will agree to let you make partial payments, or even no payments at all, and they cannot report delinquent payments to the credit bureaus for the duration.

But remember: The missed payments must eventually be made. Once you can begin paying again, says Schmidt, the servicer will discuss the various options. One might be to modify the loan by extending the terms. Another might be to place the missing amounts into a second lien, which need not be paid back until you sell the house or otherwise pay off the primary mortgage.

To help you rebuild, you might also be eligible for a grant from Uncle Sam. Your state may be able to kick in a few bucks, too.

At the federal level, the Federal Emergency Management Agency makes assistance available to homeowners and students to cover uninsured losses. And through the Rapid Unsheltered Survivor Housing program from the Department of Housing and Urban Development, local jurisdictions are given money to disburse to people in declared disaster areas who are about to become homeless, or who are already without shelter.