What is refinancing a mortgage?

Refinancing a mortgage is a type of financial transaction in which a homeowner pays off an existing mortgage loan with the proceeds of a new loan, typically with a lower interest rate. This allows the homeowner to reduce their monthly mortgage payments, or access the equity in their home. In Virginia, refinancing a mortgage requires the same process as obtaining a new loan; the homeowner must have their credit and income verified, and may need to pay off any existing liens on the property before refinancing. The homeowner will also need to provide documentation to the lender regarding the current loan, as well as the new loan they are requesting. The lender will then review all of the documents and determine the terms of the new loan. Once approved, the homeowner will sign the refinanced loan documents and pay off the balance of the old loan. The homeowner will then begin making payments on the new loan.

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