Have you been reconsidering that you should have refinanced your home a while back? Did you not take advantage of rates when they were really low? Is it too late to reduce your monthly payment or interest rate on your mortgage?

Start by looking at your credit report and cleaning up anything that is incorrect on your report. This will mean that you have the best possible score for refinancing. Your credit score will help you get the best interest rate available to you.

Now contact a good mortgage broker and have them work for you. A good mortgage broker can review your situation and find the best alternatives for you. If the broker can find you some alternatives and reduce either your monthly payment or your interest rate then you could possibly save thousands of dollars.

Reducing your interest rate will save you a lot of money over the course of the loan. By lowering your monthly payment you will see a savings each month that you can use to either reduce your debt or to build your emergency fund. Either of those options is going to benefit you in the long run.

Reducing your debt should be your first priority but if you choose to build an emergency fund first then you are still working in the right direction. This is also a good time to adjust your budget or start budgeting if you have not done so in the past. This will help you no matter which you choose to do first. Even some of the best financial advisors don't agree which should be done first. The fact is both needs to be done so which one you do first does not matter.

But if you have bad credit, then I would suggest you reduce your debt first because that will help your credit score the most. Then you can refinance and save more than you could before. Having an emergency fund is necessary because life will throw you many curveballs in the form of illness, job loss, car breakdowns or other things that you just don't have built into your budget. So take the time to do them before you have any problems.