Refinance

To obtain a new loan to pay off an existing loan; to pay off one loan with the proceeds from another. Properties are frequently refinanced when interest rates drop and/or the property has appreciated in value. This may be done to reduce borrowing costs under conditions where the borrower can obtain a new loan at an interest rate below the rate on the existing loan. Or it may be done to raise cash, as an alternative to a home equity loan. This can be a way for a debtor to use their available equity to help reduce their debts.

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