Suppose you take out a loan with the following terms:

Original Loan term:

• Loan Amount: $250,000

• Points: 2.5 (paid in cash)

• APR: 6%

• Term: 30 years, payments monthly

After making four full years of payments, you are offered a refinancing package with the following terms:

• Loan Amount: Balance outstanding at end of year 4

• Points: 3 (paid in cash)

• APR: 5%

• Term: 26 years, payments monthly

Does it make financial sense to refinance?