Refinancing makes sense if:

1. Rates have lowered significantly since obtaining your original loan.
This is one of the most valid reason to refinace. You must pay attention to the fees on you new loan. They can make a good reason turn into a very bad reason. Also you should consider making your loan term shorter than what you currently have remaining on the active loan.

2. Your credit (fico) has improved or you can document your income now.
If you can improve your fico by 50 points then you should have a good chance of getting a lower rate. The interest rate you qualify for is largely based on your credit scores. Fix your credit file and you will have better rates.

3. You have an adjustable rate mortgage and want a fixed-rate mortgage.
If rates are rising this stategy makes more sense. If you plan to sell you home during the next two years then you may not benefit from this refiance, consider the cost as a deal breaker.

4. You will not be able to make your payments unless you reduce your payment.
At this point you will need to review all options. You should ask yourself questions like 'Should I sell, and rent somewhere?', 'Is this house too expensive for me?', and 'How did I get myself into this situation?' After you find answers to these question you may find this option is the best.