Refinancing replaces an existing mortgage with a new loan, often to lower the current rate, adjust terms, or access cash from home equity.
An expert said refinancing usually makes more sense when the new rate cuts at least a full percentage point from the existing mortgage.
Upfront closing costs can run ~2% to ~5% of the loan balance, or roughly $6K to $15K on a $300K home loan.
Monthly savings can look appealing, but restarting a 30-yr term may increase total interest paid, so borrowers should compare payment relief against long-term costs.
Comparing lenders and reviewing income, assets, debts, and credit is essential; conventional approval often starts near 620, while the strongest pricing favors scores above 780.