· How Does Refinancing Work? What is a refinance and how does this process work? A refinance is a replacement of the existing loan obligation with a new loan with different terms. The most common type of refinance is a mortgage. If interest rates drop by 1 or 2%, it may be worth a refinance of your old mortgage. Reasons to refinance include:
You may be able to work with the original. circumstances change as does a homeowner’s need to borrow money. If your financial circumstances have changed, it is your right as a homeowner to.
While there may be several reasons to refinance your current mortgage, moving to a lower monthly payment likely sits at or near the top of the list. Your ability to lower your house payment depends.