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Finance & Banking vocabulary · Loans & Credit

Refinance

Meaning in finance & banking, with examples

/ˌriːˈfaɪnæns/verbCommon term

In finance & banking, refinance means: To replace an existing loan with a new one, usually to get a lower interest rate, a longer term or different conditions.

In Turkish: yeniden finanse etmek, refinanse etmek, krediyi yenilemek

How it is used

Used in mortgages and corporate finance. Homeowners refinance their mortgage when rates fall; companies refinance maturing debt with new bonds or loans. The noun is 'refinancing'. Refinancing risk is the danger that debt cannot be renewed on acceptable terms when it matures.

Example sentences

  1. Many customers want to refinance their mortgages now that rates have come down.

  2. The group plans to refinance its syndicated loan before it matures next year.

Common collocations

  • refinance a mortgage
  • refinance debt
  • refinancing risk
  • refinancing deal
  • mortgageA long-term loan used to buy a home or other property. The property secures the loan, so the lender can have it sold if the borrower does not repay.
  • early repaymentPaying back all or part of a loan before the dates set in the contract, which reduces the total interest the borrower pays.
  • restructuringChanging the terms of a loan, such as the maturity, instalments or interest, because the borrower has difficulty paying; also the reorganisation of a whole company.
  • syndicated loanA large loan provided by a group of banks together under one agreement, so that no single bank takes all the risk.
  • maturityThe date when a loan, deposit or bond ends and the principal must be repaid, or the length of time until that date.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Loans & Credit

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This page explains English vocabulary for learners. It is not financial advice.