Refinance. Refinancing is the process of replacing an existing loan with a new loan.
Often the new loan is at a lower interest rate reducing the cost of the loan.
Typically one refinances by filling out an application for a new loan. The borrowed funds are then used to pay off the old loan. But note that some loans charge extra fees for prepayment of the loan. These charges can make refinancing more costly than expected.
Related Fool Articles
Recent Mentions on Fool.com
- BreitBurn Energy Partners L.P. Slashes Payout by 50% Again, Gets $1 Billion Cash Infusion
- 3 Energy Stocks to Buy Before They Rebound
- Forget Kinder Morgan Inc: 3 Pipeline Stocks You Should Consider Buying
- 3 Oil Stocks You Can Buy and Hold for the Next 20 Years
- In Case You Missed It: 3 Big Things From the Phillips 66 Earnings Call
- Freeport-McMoRan Inc's Latest Mine Trouble Singles Out a Huge Risk That Won't Go Away