The process of paying off one loan to get another with a better interest rate and terms. There are many reasons borrowers look to refinance: lower interest rates, improved credit, debt consolidation, decrease home equity to free up cash. Loan refinancing will include fees for appraisals and title insurance, so it’s important to calculate how long it will take to pay off these closing costs resulting from refinancing. Talk with a lender to weigh the costs and benefits of refinancing. If homeowners plan on staying in their homes for a long time, then it might make sense to refinance. But if they want to sell in the next couple of years, it might be best to wait until they buy their next home to get a new loan.