Refinancing is often used to lower your interest rate. If rates have dropped since you last financed your home, you may want to consider refinancing. Other common reasons to refinance include paying off a balloon payment, converting an adjustable rate loan to a fixed rate loan or to extract cash equity in your home (cash out). A few reasons for cashing out include: home improvement, an education fund, and consolidating debt.

When refinancing one’s existing loan, it is possible that the consumer's total finance charges may be higher over the life of the loan.

Another way to convert equity in your home to cash is a "home equity" loan. A "home equity" loan is an alternative to refinancing if your home loan has a very low rate compared to current interest rates or if you have a prepayment penalty on your loan.


  • Reduce Your Interest Rate
  • Cash Out Equity for Home Improvements
  • Consolidate Debt
  • Lower Monthly Payments

To Refinance You'll Need:

Generally, you can expect to pay 2 percent to 5 percent of the loan principal amount in closing costs.
For a $200,000 mortgage refinance, for example, your closing costs could run $4,000 to $10,000.  
There are a few different fees that fall under the closing costs when you refinance your home. Origination and underwriting fee: 0.5%-1.5% of loan principal, Recording fee: Cost depends on location, Appraisal fee: $500-$700 (more for a larger property, Credit check fee:    $62 or more, Title services: $1000 - $2000, Survey fee:    $150-$400, Attorney/closing fee: $800 or more.