Refinancing
Refinancing pays off an existing mortgage with a new loan. People consider it for a different rate, a different term, a different loan type, or access to equity.
General potential benefits
- May change the rate or term
- May consolidate a first and second mortgage
- May remove certain mortgage insurance
General considerations
- Closing costs apply and affect the break-even point
- Extending the term can increase total interest paid
Common eligibility factors
- Current equity
- Credit and income review
- Property appraisal
- Payment history
Possible costs
- Closing costs
- Prepaid escrow items
- Possible appraisal fee
Questions to ask a mortgage professional
- Which loan programs am I likely to be eligible for, and why?
- What documentation will you need from me, and when?
- How do the estimated closing costs compare between programs?
- How would a change in my down payment affect my monthly payment?
- What would change if my credit profile improves before closing?
Readiness checklist
- Estimate your break-even month
- Compare total interest, not just the payment
Frequently asked questions
Estimate a payment for this pathway
Use the calculators to model a payment with your own rate, tax, and insurance assumptions. Nothing you enter is submitted anywhere.
This guide is educational. Eligibility factors described here are common considerations, not universal or guaranteed requirements. Nothing here is a loan offer, an approval, or a rate commitment. A licensed mortgage professional must verify actual terms.