Mortgage Navigator • Conventional • Refinance

Cash-out seasoning

There are two different clocks to watch: how long the existing first mortgage has existed and how long the borrower has owned or held title to the property.

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Fannie first-lien seasoning

If an existing first mortgage is being paid off through a Fannie cash-out refinance, the first mortgage generally must be at least 12 months old, measured note date to note date.

Fannie ownership

At least one borrower generally must have been on title for at least six months before the new loan's disbursement date, with exceptions for inheritance, legal awards, delayed financing and certain LLC/trust ownership history.

Freddie

Freddie also generally requires at least one borrower to have held title for six months before the new note date, and an existing first lien being paid off generally must satisfy Freddie's 12-month seasoning requirement, subject to stated exceptions.

Agency Difference: Fannie's six-month ownership test is measured to disbursement date, while Freddie's standard title test is measured to the new Note Date. On a tight timeline, exact dates matter.
Could the other agency solve this? Fannie Mae and Freddie Mac are not identical. If this scenario fails under one agency, compare the other agency's current rule and AUS result before assuming conventional financing is unavailable. A lender overlay is also different from an agency prohibition.

Official guide baseline

Fannie Mae Selling Guide · Freddie Mac Seller/Servicer Guide

Refinance classification matters. A transaction that falls outside limited/no-cash-out rules may become cash-out even when the borrower receives little or no cash personally.