A refinance is any material change to the original mortgage agreement. The most common form of refinance is a borrower accessing built up equity in their home. This can be done for a few different reasons; debt consolidation, down payment on a second home, making a large purchase, renovations to an existing property etc. 


when to refinance?

When a borrower is pulling equity out of their property they are only able to access 80% of the home’s appraised value minus any existing mortgage. A refinance can also be done to access a better mortgage rate and to extend the amortization of the loan to lower the borrower’s monthly payment.

One quick note, a borrower should not refinance without careful consideration. When you refinance to add money to your mortgage or extend your amortization you are putting yourself farther away from paying down your home loan and will increase the overall interest you will pay.