Refinancing your mortgage can be a smart financial move, whether you’re looking to lower your monthly payments, secure a better interest rate, or tap into your home’s equity. By replacing your existing loan with a new one, refinancing can help you adjust the terms of your mortgage to better suit your current financial situation. It’s especially beneficial if interest rates have dropped since you purchased your home or if your credit score has significantly improved.

There are different types of refinancing options to consider. A rate-and-term refinance focuses on reducing your interest rate or changing the loan term, while a cash-out refinance allows you to access a portion of your home’s equity for big expenses like renovations or debt consolidation.