Refinancing is the process of taking out a new loan in order to pay off your existing loan. Here’s what that process looks like:
1. You have an existing loan you would like to improve in some way - whether that’s rates or duration.
2. You find a lender with better loan terms, and you apply for the new loan.
3. The new loan pays off the existing debt completely.
4. You make payments on the new loan until you pay it off or refinance it.