repayment
Refinance
Refinancing is replacing existing debt with new debt at different terms, typically to lower the rate, extend the term, or change the collateral.
Last updated Reviewed by ICG Funding
Definition
What it means.
A refinance pays off one loan with the proceeds of another. For small businesses, common triggers are an improved credit profile, an expiring bridge or balloon, or the arrival of lower-cost SBA-backed financing.
Refinancing costs include origination fees on the new loan, prepayment penalties on the old loan, and closing / legal costs. Net the savings against total costs over the remaining term before deciding.
Now what?
Get an offer that accounts for refinance.
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