Finance
A 'rate and term refinance' allows a borrower to:
ATake cash out from their equity for home improvements
BReplace their existing mortgage with a new one at a different interest rate or term without taking out cash✓ Correct
CAssume another borrower's mortgage
DConvert a fixed-rate loan to an adjustable-rate loan
Explanation
A rate and term refinance replaces an existing mortgage with a new one at a lower interest rate, different term, or both, without extracting additional cash beyond closing costs. It is used to reduce monthly payments or pay off the loan faster.
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