Refinance: What It Is, How It Works, Types, and Example
Introduction to Refinance Refinance is the process of obtaining a new loan to pay off an existing one. This can be done to obtain a lower interest rate, lower monthly payments, or to access the equity in your home. It can also help to improve your credit score if you have a history of late payments or high debt. However, it is important to carefully consider the costs and potential risks associated with refinancing before making a decision. Reasons for refinance One of the most common reasons for refinancing is to secure a lower interest rate. When interest rates drop, homeowners can refinance their existing mortgage to take advantage of the lower rates. This can result in significant savings over th...