Definition of Refinancing-refinancing mortgage means your pain interest on existing loan and replacing with new one there are so many reason for refinance because of lower interest rate, cost of refinancing about 3% to 6% on the loan principal.
now the question is how refinance can reduce interest rate because there is reason for example if you take loan from any other bank you paid all the premium amount on regular basis after completing you want 1 alone again from same bank it’s call refinance it reduce your interest rate and reducing your interest rate not only helps you save money, but it can also decrease the size of your monthly payment. Let’s understand
A 29-year fixed-rate mortgage with an interest rate of 6% on a $200,000 home has a principal and interest payment of $804.62. That same loan at 4.5% will reduce your payment to $500.25