When Can I Refinance
You can often refinance as soon as your lender will approve you, but some refinances require your current loan to be “seasoned,” meaning it must be a certain age. Rate-and-term refinances usually have little or no waiting period, while cash-out refinances commonly require several months of ownership. Equity and credit matter most.
Key Takeaways
- Seasoning is the age of your current loan or how long you have owned the home. It applies most often to cash-out refinances.
- Rate-and-term refinances generally have fewer waiting requirements than cash-out refinances.
- Equity drives pricing and mortgage insurance. Under 20% equity usually means mortgage insurance on a conventional loan.
- Credit score, income, debts and property type decide whether you qualify and at what price.
What does “seasoning” mean for a refinance?
Seasoning is the time that has passed since you bought the home or closed your current loan. Lenders and loan programs use it to confirm that you have a real payment history and that a quick resale or flip is not driving the loan. Programs set their own rules, and lenders may add stricter ones, so treat any timeline here as a general guide and confirm yours with a Licensed Lendia California Loan Officer.
How long do I have to wait for each type of refinance?
| Refinance type | General seasoning |
|---|---|
| Conventional rate-and-term | Usually none beyond closing on the current loan |
| Conventional cash-out | Generally at least 6 months on title, and the loan being paid off is often at least 12 months old |
| FHA streamline | Requires an existing FHA loan with a record of on-time payments and a net tangible benefit |
| FHA cash-out | Generally longer than conventional, often about 12 months of ownership and payments |
| VA IRRRL | Later of 210 days after the first payment and 6 payments made |
| VA cash-out | VA and lender timelines apply; see the VA guide below |
Details for each cash-out case are on the cash-out timeframe page. For VA loans, see how long to wait before refinancing a VA loan.
Does equity affect when I can refinance?
Yes. Equity is the part of your home’s value you own, which is the value minus what you owe. Lenders express it as loan-to-value (LTV): the loan amount divided by the home’s value.
- With 20% or more equity (80% LTV or lower), a conventional loan generally does not need PMI.
- With less than 20% equity, conventional loans generally carry PMI, and pricing is higher.
- Cash-out refinances limit how much you can borrow. Conventional cash-out on a primary residence is generally limited to about 80% LTV, and FHA is up to 80%. VA has its own limits.
California home values change quickly by city, so your equity may differ a lot from what you assume. A new appraisal sets the number the lender uses. See using a new appraisal for how that works.
How does credit affect refinancing?
Most conventional refinances require a credit score of at least 620, and higher scores generally earn better pricing. Other programs set different minimums, and lenders may add their own. Beyond your score, the lender reviews:
- Payment history on your current mortgage. Recent late payments can block streamline programs.
- Debt-to-income ratio (DTI). Conventional loans are commonly approved up to about 45%, and sometimes up to around 50% with strong factors.
- Income and employment stability and, for the self-employed, the type of documentation available.
- Reserves for larger loans, second homes and investment properties.
Other situations that change the timeline
You inherited the home
Seasoning rules can be different when you received a property by inheritance. Programs, especially FHA, can treat rental history differently, so ask before assuming a waiting period applies or does not apply.
You moved back into a former rental
If you are converting a former investment property to a primary residence, lenders may require time living there before treating it as owner-occupied, and the loan type may be limited. Occupancy rules differ by program.
You used a recent loan modification or had a credit event
Mortgage lates, forbearance exits or a recent bankruptcy can add waiting periods. Some of these are covered in our VA credit events guide, VA loan credit events and waiting periods, and in the FHA loan after bankruptcy guide.
What should I do before I apply?
- Pull your mortgage statement and note the origination date, balance and any prepayment terms.
- Check your credit reports for errors and try not to open new accounts.
- Estimate your home’s value from recent nearby sales. The appraisal decides the real number.
- Decide whether you want cash out, because that triggers the longer seasoning rules.
- Estimate your break-even with the break-even calculator.
For the full list of factors, read what to consider before refinancing. The chapter overview is on the refinancing a home page.
At Lendia, we check your eligibility before you pay for anything
At Lendia, we review your loan age, equity, credit and goals up front, then tell you which refinances are available now and which ones will open later. Contact us or get a rate quote now.
Frequently Asked Questions
Can I refinance right after buying a home?
Sometimes. A rate-and-term refinance may be possible quickly under many programs, but cash-out generally needs several months of ownership, and your lender may have its own wait.
How much equity do I need to refinance?
Requirements vary. Conventional loans generally need at least a small amount of equity, and you avoid PMI at 20% equity. Cash-out refinances leave behind a cushion, commonly 20% on conventional loans.
What credit score do I need to refinance?
Many conventional refinances start at 620. FHA and VA programs have their own minimums and lenders may add overlays, so ask for your program.
Can I refinance with a prepayment penalty?
Possibly, but check your note first. Penalties are uncommon on conventional, FHA and VA loans, and more common on some non-QM loans. See Do conventional loans have prepayment penalties?
Can I refinance if my home value dropped?
You may still be able to, depending on LTV and the program. Streamline programs for FHA and VA loans can have lighter appraisal requirements.
Rates and terms depend on your situation; approval requires qualification.
Talk to a Licensed Lendia California Loan Officer
At Lendia, we review your situation and show you the programs you qualify for.