Refinancing a mortgage will replace your current mortgage with a new one. The process is the same as your first application. You will have to supply financial documents to support your new mortgage. Refinancing is often a wise decision that can allow you to meet a variety of needs:
- Lower your monthly payments by taking advantage of lower interest rates or longer repayment periods.
- Take the risk out of your mortgage interest rate by replacing an adjustable rate mortgage (ARM) or balloon mortgage with a fixed rate mortgage.
- Shorten the term of your loan to pay off your mortgage faster.
- Take equity out of your home for expenses or to consolidate debt.
Total finance charges may be higher over the life of the loan.
