When you refinance a debt, you replace one debt with another debt. The goal of refinancing a debt is usually to secure a better interest rate and payment terms—such as lower monthly payments. You might also seek to consolidate some debts through refinancing by borrowing enough money from an existing lender to pay off some debts to other lenders (such as credit cards) and make one smaller monthly payment, rather than multiple monthly payments.

In Oregon, as in many states, refinancing a debt involves taking out a new loan to pay off an existing one. This process is regulated by both state and federal laws. The Oregon Division of Financial Regulation oversees the practices of lenders within the state to ensure they comply with applicable laws. When refinancing, consumers often aim to secure lower interest rates, reduced monthly payments, or to consolidate multiple debts into a single payment. It's important for consumers to consider the terms of the new loan, including the interest rate, fees, and the repayment period. Federal laws, such as the Truth in Lending Act (TILA), require lenders to provide clear and conspicuous disclosures about the terms and costs of loans, which helps consumers make informed decisions when refinancing. Additionally, the Equal Credit Opportunity Act (ECOA) protects consumers from discrimination in any aspect of a credit transaction, including refinancing. Consumers in Oregon considering refinancing should review the terms carefully and may seek advice from an attorney to understand the implications of the new debt agreement.