Refinancing, simply put, is basically getting another loan on paying off an existing loan. Let me tell you more about what is refinancing a loan and reasons people opt for it. If you like my answer and find it informative please leave an upvote.
Need best deals and interest rates on a home loan? Check out NoBroker Home Loans services Refinance loan meaningAs I explained earlier, refinancing a home loan is an act of seeking a loan from another lender to pay off an existing loan or more loans.
Reasons to refinance loan- To save cost on interest:
When a new lender comes up with an offer of a lesser interest rate, people think about refinancing their home loan.
- To switch interest rate methods:
You should know that there are two types of interest rates - floating interest rate and fixed interest. People can think about refinancing home loan from either of the two.
- To seek top-up
: Another case of refinancing loan can be when you need a top up on prevailing home loan interest rate. It is also known as incremental funding.
- Due to change in financial health
: An individual can choose to refinance a loan when their financial health changes for the worse at most times.
I hope you have understand now what is refinancing a loan and reasons people can opt for it.
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Authors Of The Question
What is refinancing a loan?
Mitika
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2 Year
2022-05-19T11:13:02+00:00 2022-05-19T13:51:01+00:00Comment
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