Mortgage Refinance Explained: What Homeowners Should Know Before Starting

Refinancing replaces an existing mortgage with a new mortgage. A homeowner may consider refinancing to review the current loan structure, change the mortgage term, access available equity, consolidate qualifying debts, finance eligible home improvements, or move from an adjustable-rate mortgage to a fixed-rate mortgage. A refinance is not automatically beneficial for every homeowner. Closing costs, fees, loan term, interest rate, annual percentage rate, property value, income, credit, debt obligations, and the amount of time the homeowner plans to remain in the property can all affect the decision. Potomac Financial Hub helps homeowners organize a preliminary refinance inquiry and understand what information may be needed before speaking with a participating licensed mortgage provider. PFH is not a mortgage lender and does not make commitments to lend. When an appropriate participating provider is identified, the homeowner should receive the provider’s identity and licensing information before moving into a formal application or authorizing transfer of preliminary information. If you are considering a refinance, start with a preliminary review so you can better understand the next step.

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