What term describes replacing an existing loan with a new loan secured by the same property?

The term that describes replacing an existing loan with a new loan secured by the same property is known as refinancing. Refinancing allows borrowers to obtain a new loan, often to secure better interest rates, change loan terms, or access equity in the property. In this process, the new loan pays off the existing mortgage, effectively replacing it while using the same collateral— the home itself.

This is a common strategy for homeowners looking to improve their financial situation, as it can lead to lower monthly payments or lessen the overall interest paid over time. Additionally, refinancing may facilitate the consolidation of debt or provide funds for home improvements, thereby enhancing the property's value.

In contrast, options like an equity loan and a home equity line of credit refer specifically to borrowing against the equity in a property, rather than replacing the existing mortgage. A consolidation refers to combining multiple loans into a single loan, which may not necessarily involve the property as collateral in the same manner as refinancing. Thus, refinancing is the most accurate term for the action of replacing an existing loan with a new one secured by the same property.