Refinancing is a financial strategy that allows borrowers to replace an existing loan with a new one that has better terms. It is a common practice in mortgage lending, student loans, and personal loans, offering the opportunity to secure lower interest rates, change loan durations, or adjust payment structures to align with financial goals. Understanding what refinancing a loan means is essential for anyone seeking to optimize their financial health. The process can lead to significant savings, but it also requires careful consideration to avoid potential drawbacks.