Refinance your Mortgage

Written By Erica Roberts
 

Refinance Your Mortgage: Simple Guide for Louisiana Homeowners

Lower your payment, drop PMI, or pull cash out—here’s how refinancing works in Louisiana and when it makes sense.

What Does It Mean to Refinance?

Refinancing replaces your current mortgage with a new one—usually to save money, shorten your term, or access your home’s equity. Your new loan pays off the old one, and you begin making payments on the new mortgage (sometimes with a new servicer).

Why Refinance?

  • Monthly Savings: A lower interest rate can reduce your payment. Some streamline programs don’t even require a new appraisal.
  • Remove Mortgage Insurance (PMI): If you have 20%+ equity, refinancing can eliminate PMI and lower your monthly cost.
  • Debt Consolidation: Use equity to pay off high-interest balances at a lower mortgage rate.
  • Home Improvements / Pool: Tap equity for upgrades that add comfort and value.

Common Refinance Options

1) Rate & Term Refinance

Swap your old loan for one with a lower rate or a shorter term (e.g., 30 → 15 years). Even if a 15-year payment is higher, interest savings can be substantial over time.

2) Cash-Out Refinance

Borrow up to about 80% of your home’s value and take the difference in cash. Example: Home value $200,000, balance $120,000 → access up to ~$40,000. Great for renovations, debt payoff, or large expenses.

Cash-out increases your loan amount and may raise your payment and/or extend the term. Make sure the benefits outweigh the costs.

What Happens to My Old Loan?

Your new mortgage pays off the existing one in full. The old loan is closed, and you’ll make payments on the new mortgage going forward. Loan servicing may transfer, which is normal.

Not sure if refinancing is worth it right now?

Answer three quick questions and we’ll estimate your savings. Or, get a personalized rate review from Parish Lending.

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Serving homeowners across Baton Rouge, Ascension, Livingston, and throughout Louisiana.