Mortgage Refinance

Mortgage refinancing means renegotiating your existing mortgage for a new one. Homeowners refinance to access the equity of their home for cash, taking advantage of lower interest rates to decrease their mortgage payments.

Possible reasons to refinance

One can also refinance to consolidate high-interest debt payment from a credit card, car loan or other lines of credit.

With the money taken out of a refinance, homeowners can spend it on:

How does it work?

Homeowners generally refinance at the end of the term, or near the end to avoid large or any prepayment penalties. It's ideal to refinance when rates drop to offset the additional costs of refinancing.

Costs of refinancing

There are several costs (approximate) to keep an eye on when you refinance your home:

Given the above, total fees could range from about $1250 to $2050.

When working with a mortgage broker (like Breezeful), they can help you calculate if the refinancing is worth the above costs.

Homeowners also don't have to pay mortgage brokers to refinance their home. They are paid by the lender.

Renewal vs. refinance

These two terms are often used interchangeably but are different. While a mortgage refinance replaces your current mortgage with a new one, a mortgage renewal is the same loan but with different terms. The terms generally differ in payment amounts or frequency.

Refinance calculator

To calculate how much you can borrow when refinancing: take 80% of the home’s value and subtract your remaining mortgage balance. For example, if your home is worth $500,000, 80% of that would be $400,000. Assuming there is $300,000 left on the mortgage, you would be able to borrow up to $100,000 when you refinance.

You can take out: $0.00

Alternatives

If you don't qualify for a mortgage refinancing you can try a second mortgage or a home equity line of credit. Otherwise, you learn about a mortgage pre approval.

Breezeful can make sure that refinancing can be worth it for you, regardless of the purpose of the refinance. Learn more about Breezeful here.

Refinance your mortgage today

Apply now to find out how much you can take out when you mortgage refinance