Search Dictionary

Definition of 'Refinance'

Refinancing is when you take out a new loan to pay off an existing loan. This can be done for a variety of reasons, such as to get a lower interest rate, to shorten the length of your loan, or to get a different type of loan.

There are a few things to keep in mind when refinancing your mortgage. First, you need to make sure that you're actually going to save money by refinancing. This means that you need to compare the interest rate on your new loan to the interest rate on your current loan. You also need to factor in the closing costs associated with refinancing, which can be significant.

Second, you need to make sure that you're comfortable with the terms of the new loan. This includes the interest rate, the length of the loan, and any fees that are associated with the loan.

Finally, you need to make sure that you're prepared for the closing process. This can be a time-consuming and stressful process, so it's important to be prepared for what to expect.

If you're considering refinancing your mortgage, it's important to talk to a qualified mortgage professional. They can help you assess your options and make the best decision for your financial situation.

Here are some additional things to keep in mind when refinancing your mortgage:

* The interest rate on your new loan is not guaranteed. It's possible that the interest rates could go up before you close on your new loan.
* You may have to pay prepayment penalties if you pay off your loan early.
* Your credit score will be affected by refinancing your mortgage. If your credit score goes down, you may not qualify for the best interest rate on your new loan.

Refinancing your mortgage can be a good way to save money and get a better deal on your loan. However, it's important to weigh the pros and cons carefully before you make a decision.

Do you have a trading or investing definition for our dictionary? Click the Create Definition link to add your own definition. You will earn 150 bonus reputation points for each definition that is accepted.

Is this definition wrong? Let us know by posting to the forum and we will correct it.