Question by km: Can a person refinance a home equity loan, as opposed to a refinancing a mortgage? ?
A couple of years ago, my spouse and I doubled the size of our home which we had owned “free and clear.” To do so, we took out a 20 year home equity loan for $ 250,000 at a rate of 5.85%. Since we already owned the home and this was technically not a mortgage, there was no downpayment on this loan. With rates coming down, do we have any hope of refinancing our home equity loan? Or, is refinancing basically restricted to mortgages? Thanks.
Answer by scottsmylie
You can refinance a home equity loan. 5.85 seem like a very low rate as it is for a home equity though.
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because the loan was secured by real estate it is technically a mortgage. If you do refinance you will be looking at a either a new conventional mortgage or a new home equity loan.