Mortgage Refinance
Quick Summary
Replacing your current mortgage with a new one, often to change rate, lender, or loan amount.
ELI5 Explanation
Click to expand
You get a new mortgage to improve terms or take cash out.
Detailed Explanation
Refinancing can lower interest cost, consolidate debt, extend amortization, or access home equity. It can also trigger penalties on a closed mortgage and create new closing costs, so the break-even math matters.
Example
A borrower refinances to pay off high-interest debt and moves from a private mortgage to a cheaper lender after improving documentation.
Why It Matters
Refinancing is a common exit strategy, but fees and penalties can erase savings if timing is wrong.