If you purchase a new home and need to borrow money to help pay for the home, you do so by taking out a "mortgage" from a lender of the money. A mortgage is really an agreement which identifies the property and the terms of repayment. Simultaneously, the borrower signs a note which is the personal guarantee the loan will be repaid. REFINANCING - is nothing more that replacing the old mortgage with a new one with, hopefully, better terms and conditions than the original one. It may, in fact, provide more money (equity withdrawal) than the original mortgage loan.