Refinancing a Mortgage means paying off an existing loan and replacing it with a new mortgage with a new term, interest rate, and monthly payment. The typical American homeowner with a mortgage refinances every four years, according to the Mortgage Bankers Association.

Refinancing into a lower rate may significantly reduce your monthly mortgage payment

You can extend or shorten the term on your loan according to your budget

A cashout refinance might be a great opportunity for you to tap into some of your home equity.

Permits switch from fixed to floating/adjustable interest rate

Refinancing a loan involves taking out a new loan to pay off and replace the first one.

Refinancing can make sense if it will lower your monthly payments by replacing a high interest rate with a lower one.

You'll pay all the same closing costs that you did when you took out the first loan, and this can add up to thousands of dollars upfront, depending on the size of your new loan.

A cash-out refinance can provide you with some cash to pay for a significant life event like a wedding or to remodel or improve your home. You’ll receive the difference between your new loan balance and the old loan balance in cash.

If you've decided that now is the right time to apply for a refinanced mortgage, process of refinancing is very similar to applying for a mortgage

Should be a clear financial goal

Understand Your Current Mortgage

Check how much home equity you have

Getting quotes from multiple lenders

Be transparent with your finance

Prepare for your appraisal

Come to the closing with cash

Keep tabs on your loan