re·​fi·​nance | \ ˌrē-fə-ˈnan(t)s How to pronounce refinance (audio) , (ˌ)rē-ˈfī-ˌnan(t)s, ˌrē-(ˌ)fī-ˈnan(t)s\
refinanced; refinancing; refinances

Definition of refinance

: to renew or reorganize the financing of something : to provide for (an outstanding indebtedness) by making or obtaining another loan or a larger loan on fresh terms refinance a mortgage With rates tumbling, pay a little more now and retain the flexibility to refinance again next year.— Daniel Kadlec

Examples of refinance in a Sentence

Recent Examples on the Web

Company owner Kevin Armata predicted a short-term cash crunch would soon end, and WMG would reorganize and refinance its way out of Chapter 11 protection from creditors by last fall. Jon Lender,, "Jon Lender: State-subsidized firm bounces 97 checks — as it’s supposed to be recovering from bankruptcy," 27 June 2019 The bond proceeds also are helping to pay for improvements SMOC is making to several of its other downtown properties, and a portion will go to refinancing past debt. John Laidler,, "Framingham anti-poverty agency gets money for new facility," 18 June 2019 By refinancing the 2015 bonds, the county will be able to take advantage of improved interest rates and save about $12 million over the life of the loans. Robert Higgs,, "Cuyahoga County to borrow up to $40.5M for arena, ball field upgrades and repairs, refinance another $40M in bonds," 11 June 2019 Mortgage rates climbed for a good part of 2018, slowing the homebuying and refinancing market. Allison Prang, WSJ, "Mortgage Rates Hit Lowest Point in Nine Months," 10 Jan. 2019 My clients could tackle their debt, build equity and save for a larger down payment over the next three years in order to eventually refinance with a traditional 30-year loan, and the seller knew her cats’ care was secured by a first deed of trust. Neal J. Leitereg,, "In L.A., first-time home buyers face competition akin to ‘Game of Thrones’," 7 June 2019 Freddie Mac said more than $2 trillion of conventional mortgages are now eligible to be refinanced, including the majority of those originated in 2018. R.a. Schuetz, Houston Chronicle, "Mortgage rates fall to lowest level in nearly two years," 6 June 2019 But often the new loan can’t exceed the amount of the mortgage being refinanced. WSJ, "WSJ Tax Guide 2019: Mortgage-Interest Deduction," 15 Feb. 2019 Financing fixes: Cuyahoga County Council has approved refinancing $40 million in bonds that were sold four years ago to pay for work at sports venues and voted to sell new bonds to raise up to $40.5 million more. Cliff Pinckard,, "Greater Cleveland Partnership supports state bill to repeal Cuyahoga County bag ban: The Wake Up for Tuesday, June 12, 2019," 12 June 2019

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'refinance.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of refinance

1995, in the meaning defined above

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Statistics for refinance

Last Updated

13 Jul 2019

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Time Traveler for refinance

The first known use of refinance was in 1995

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Financial Definition of refinance

What It Is

Refinance refers to the replacement of a debt with new debt bearing different terms.

How It Works

Financing involves borrowing a specific amount of money over a length of time at an agreed-upon interest rate.  Payments on the debt are divided between interest and principal.  If circumstances change, for example, the length of time needed to repay the debt is longer and the lender agrees, the loan may be refinanced, extending the term and lowering the period payments (because they are extended over a longer period of time.)  If interest rates change, the debt may be refinanced using a lower interest rate.

For example, the $150,000 loan below is shown with a term of 15 years at 8% per year.  By year 5, the market interest rate drops to 5%.  When the loan is refinanced over the balance of the term, for example, the savings in principal and interest payments on the loan will be over 32,000.

Refinancing may also convert an adjustable rate mortgage to a fix rate mortgage, reducing the interest rate risk to the borrower.

Why It Matters

Refinancing may be restricted on debts containing "call provisions," requiring a penalty payment in the event of a refinancing. In addition, a refinancing usually requires a closing and transaction fee that may be expensive. As a result, it is important to calculate the present value (the value in today's dollars) of the savings and compare it to the closing costs of the refinancing.

Source: Investing Answers



English Language Learners Definition of refinance

: to get a new loan to pay (an older debt) : to finance (something) again


transitive verb
re·​fi·​nance | \ ˌrē-fə-ˈnans, -ˈfī-ˌnans How to pronounce refinance (audio) \

Legal Definition of refinance

 (Entry 1 of 2)

1 : to renew or reorganize the financing of
2 : to revise the terms of (a debt obligation) especially in regard to interest rate or payment schedule refinance a mortgage

intransitive verb

: to finance something anew



Legal Definition of refinance (Entry 2 of 2)

: a financing of something anew especially : a revision of the terms of a debt obligation (as a mortgage)

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Rhyming Dictionary: Words that rhyme with refinance

Spanish Central: Translation of refinance

Nglish: Translation of refinance for Spanish Speakers

Britannica English: Translation of refinance for Arabic Speakers

Comments on refinance

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something desired as essential

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