refinance: meaning, definition, pronunciation and examples
B2Formal/Technical
Quick answer
What does “refinance” mean?
To obtain a new loan to pay off an existing loan, typically to secure better terms like a lower interest rate.
Audio
Pronunciation
Definition
Meaning and Definition
To obtain a new loan to pay off an existing loan, typically to secure better terms like a lower interest rate.
More broadly, to reorganize or restructure the financing of something, such as a company's debt or a major project, by replacing existing financial arrangements with new ones.
Dialectal Variation
British vs American Usage
Differences
No significant difference in meaning. Spelling is consistent. The concept and process are identical in both financial systems.
Connotations
Neutral financial/economic term in both variants.
Frequency
Equally common in both British and American English, given the global nature of finance.
Grammar
How to Use “refinance” in a Sentence
[NP] refinanced [NP] (with [NP])[NP] was refinancedto refinance [NP]Vocabulary
Collocations
Examples
Examples of “refinance” in a Sentence
verb
British English
- They plan to refinance their buy-to-let mortgage before the fixed rate ends.
- The council is seeking to refinance the outstanding debt on the leisure centre.
American English
- We refinanced our house to get cash for a kitchen renovation.
- The corporation refinanced its high-yield bonds ahead of schedule.
adverb
British English
- [N/A - No adverb form.]
American English
- [N/A - No adverb form.]
adjective
British English
- [N/A - 'refinance' is not standardly used as an adjective. Use 'refinancing' as a modifier: 'refinancing options', 'refinancing boom'.]
American English
- [N/A - 'refinance' is not standardly used as an adjective. Use 'refinancing' as a modifier: 'refinance application', 'refinance market'.]
Usage
Meaning in Context
Business
The board decided to refinance the company's corporate bonds to extend the maturity date.
Academic
The paper analyses the macroeconomic effects of a wave of mortgage refinancing during a period of falling interest rates.
Everyday
We're looking to refinance our mortgage while rates are low.
Technical
The securitisation vehicle was set up to acquire and refinance a portfolio of non-performing loans.
Vocabulary
Synonyms of “refinance”
Strong
Neutral
Weak
Vocabulary
Antonyms of “refinance”
Watch out
Common Mistakes When Using “refinance”
- Using 'refinance' to mean simply getting a second, additional loan (e.g., for a new car) without the core purpose of replacing an existing one.
- Incorrect preposition: 'refinance my loan *with* a lower rate' should be 'refinance my loan *to get/at* a lower rate'.
FAQ
Frequently Asked Questions
No, while commonly associated with mortgages, you can refinance any type of loan (car loan, student loan, business debt) or bond issuance.
Debt consolidation is a specific type of refinancing where multiple debts are combined into one new loan, often to secure a lower overall payment or interest rate.
It is possible but more difficult. Lenders may offer less favourable terms or deny the application, as the primary purpose of refinancing is to secure better terms, which typically require good credit.
Both. 'To refinance' is the verb. The process or act is called 'refinancing' (a gerund/noun). Example: 'Refinancing can save you money.'
To obtain a new loan to pay off an existing loan, typically to secure better terms like a lower interest rate.
Refinance is usually formal/technical in register.
Refinance: in British English it is pronounced /ˌriːˈfaɪ.næns/, and in American English it is pronounced /ˌriːˈfaɪ.næns/ /ˌriː.faɪˈnæns/. Tap the audio buttons above to hear it.
Phrases
Idioms & Phrases
- “[No common idioms specific to this verb]”
Learning
Memory Aids
Mnemonic
Think: RE-do your FINANCE. You are doing your finance again to get a better deal.
Conceptual Metaphor
FINANCIAL AGREEMENTS ARE STRUCTURES (you restructure debt). FINANCE IS A FLUID (you redirect the flow of credit).
Practice
Quiz
What is the primary goal of refinancing a loan?