Refinancing to bring big savings

CHICAGO » Homeowners who refinanced their mortgages last year should have some extra coin in their pockets this year: $5 billion worth of saved interest in the first 12 months.

Only about 52 percent of mortgages made in 2014 were refinancings, but sharp declines in average mortgage rates during the last three months of the year created a miniature refinancing boom, according to the Mortgage Bankers Association. During the fourth quarter, borrowers who refinanced cut their mortgage rate by almost one-fourth, or by an average interest-rate reduction of 1.3 percentage points.