Delayed financing
A buyer who purchased a property with cash may be able to refinance quickly and recover documented invested funds without waiting six months.
Fannie delayed financing exception
Fannie permits a cash-out refinance within the first six months when the original purchase was an arm's-length transaction, no mortgage financing was used to acquire the property, title is clear, and the borrower's source of purchase funds is fully documented.
Maximum new loan basis
The new loan amount is limited by the documented amount of the borrower's original investment plus eligible refinance closing costs, points and prepaid items, while still respecting the cash-out LTV limits based on current appraised value.
Borrowed purchase funds
If an unsecured loan or a loan secured by another asset/property funded the purchase, Fannie requires refinance proceeds to pay off or pay down that acquisition debt as applicable. Gift funds used for the purchase cannot be reimbursed through the delayed-financing refinance.
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.