How Soon After Purchasing Can I Refinance
January 22, 2025 | Posted by: Sherry Corbitt
This is a common question that many homebuyers ask themselves. With the hot housing market right now, some who have just purchased may want to refinance as soon as possible. The following points will discuss how soon you can refinance after purchasing, some ways to refinance sooner, and why refinancing sooner is better.
When Can I Refinance?
In most cases, many homeowners who mortgage into a lower rate loan, or typical mortgage, can refinance without a waiting period. Yet there are many different waiting periods, depending on your loan type and situation.
Seasoning Period
It is important to remember that if you just purchased a home, your lender will most likely stick to a seasoning period. This means that they will want to wait at least six months before completing a refinance on your home. Luckily though, there are ways to get around this issue. First, you can search for another lender who will refinance your home. Looking around for lenders can be time-consuming and sometimes decline your offer quickly, though. Consider getting a mortgage broker since they have connections and can get a mortgage much quicker and typically at lower rates.
Cash-Out Refinancing
If you are looking to refinance to cash out, there are some critical things to keep in mind. First, you need to have at least 20%-25% equity on your house for a cash-out to work. The higher your down payment is on your home, the higher your equity. Depending on how much you put down for your down payment, you either will be able to refinance right away or need to wait for a bit. If you did not put a large down payment down, then you will need to wait until your payments are equal to the required percentage amount.
Why Refinancing Sooner is Best
Getting a Better Mortgage
Getting a refinance is mainly to change your mortgage loan. If you are eligible to get a better mortgage now and pay less, it makes much more sense to do so as soon as possible. As a homeowner, you are almost wasting money by not choosing to get a lower amount on your mortgage. You can get a lower monthly payment schedule, which can save you thousands of dollars every year that you are currently paying towards your mortgage. You can now put this money towards something else,
Wanting to Make Home Repairs
If you want to repair some parts of the house, refinancing can make these home renovations possible. By refinancing, you can take out the home equity you have and use that money towards the renovations. This way avoids having to wait longer to repair your home or, even worse, getting a loan for the materials and lowering your credit score.
High Credit Score Benefits
If you have a high credit score, then choosing to refinance now is a perfect idea. You have much more opportunities with your refinance, such as rates and payment schedules. This flexibility can allow you to gain a mortgage that is much more suitable to you than the one you currently have. To ensure that your credit score hasn’t changed without your knowledge, though, it is essential to double check on your credit history documentation, which you can access online or by telephone.
Refinancing can be done very quickly and easily after getting a mortgage. Depending on your circumstances, you may want to consider if you are ready for a refinance. Keep in mind that there are many benefits with doing so sooner rather than later.
If you have any questions regarding getting a refiannce, please reach out to me.
Sherry Corbitt, Mortgage Broker
Sources
-Martin, Erik. J (2021). How Soon Can You Refinance? No Waiting Period For Many. The Mortgage Reports. Retreived from
https://themortgagereports.com/54100/how-soon-can-i-refinance-after-i-close-on-my-mortgage
