Refinancing is the process of taking out a new mortgage to repay an existing loan: often because there has been a change in your personal or financial situation, or simply because you want a better deal on your home loan.
While this can be with the same lender, it is also common to change to a different provider. Those looking to refinance their existing mortgage are increasingly carrying out much of their research online by comparing home loans to review what the market has to offer.
It’s not uncommon for lenders to handle most of the process once you have made your choice and been approved, so refinancing may be relatively straight forward and less complex than securing your first mortgage.
Why would you refinance?
Refinancing can be a smart way to manage your money. It may give you the option of securing a better deal, consolidating debts, or unlocking equity in your current property, depending on the options you take.
When refinancing, you generally want to increase, decrease, or keep the loan amount the same.