A standard refinance paying off an existing mortgage with the proceeds from a new loan. In order to decide whether this is worthwhile, the savings in interest must be weighed against the fees associated with refinancing. Other reasons to refinance include reducing the term of a longer mortgage, or switching between an adjustable-rate and a fixed-rate mortgage.
Acash-out refinanceis taking a loan for more than you owe on your existing mortgage. Your existing mortgage is paid off from the new loan proceeds and you receive the balance of the new loan.