 TITLE: How Does Refinancing a Mortgage Work? CONTENT: The process of refinancing a mortgage is similar to the process of getting one in the first place. You typically start by shopping around and comparing interest rates and other terms with various mortgage lenders to see which has the best offer. Then you compare that offer with the terms of your existing loan.\nIf your credit has improved since you were approved for your first loan, you may have a good chance of qualifying for more favorable terms.\nAs you go through this process, keep an eye on the closing costs. For example, if refinancing your loan with a new lender costs $5,000 upfront, and your new monthly payment is just $100 lower than what you're currently paying, you'll need to stay in the home at least 50 months to make the move worth it.\nAlso, watch out for things like prepayment penalties, which can cause problems down the road if you pay off the mortgage early or refinance again. END