How Often You Can Refinance Your Mortgage

There’s many reasons people choose to refinance after closing purchase or refinance, and it’s more common than you’d think. Before discussing how often you can refinance your mortgage, however, we must explain why you’d do this..

Why People Re Refinance

There are many reasons people choose to refinance soon after closing on home purchase or refinance. Some examples include;

• Interest rates dropped after closing current loan
• Have an adjustable-rate mortgage and want to switch to a fixed loan
• Won’t be in home as long as long as the 30-year fixed loan
• Household Income increase and want a 15-year fixed loan
• Household income decreases, now want a lower payment
• Looking to buy out a co-borrower
• Want to pay off a second mortgage

These aren’t the only scenarios that result in refinancing again. Bottom line is if it makes financial sense, don’t shy away from the possibility.

How Soon You Can Refinance Your Mortgage, Again

You can refinance as many times as you’d like.

However, every time you refinance, your mortgage resets—this can be dangerous.

Because it takes time to pay off your interest and mortgage, refinancing again and again can hurt your chances of ever paying off your mortgage.

When choosing to refinance after closing on your previous loan, it is recommended to do so within the year to limit the financial set-back.

Refinance Without Adding Years To Your Loan

There’s ways to refinance without extending your repayment.

a) Refinance to a mortgage with a shorter term

Loans with shorter terms usually have lower interest rates, which could lessen the additional payments. Though terms are usually 30 and 15 years, it’s in your best interest to explore the 10 and 20-year mortgage options.

b) Use the remainder of your current mortgage term to calculate a payment

For example, if your current 15-year loan is three years old, calculate a payment for your refinance based on a 12-year loan term. Send in the extra separately and label it a “principal reduction.”

How Often You Can Refinance Mortgage 

It depends on your refinance type..

If you refinance with a Fannie Mae or Freddie Mac loan, there is no delay time, considering your new loan is a “rate and term” refinance.

A rate and term refinance is one in which your new mortgage is the same as the remaining balance on your old mortgage.

There are no time requirements if you refinance from a non-FHA mortgage to a FHA loan.

FHA cash-out refinances require a minimum of six months of payments made for the current mortgage before eligible. FHA Streamline refinances require a minimum of six months, as well as a minimum of 210 days passed since current mortgage closed.

You can also refinance with a “limited cash out” refi, which lets you complete your previous loan and include the refinancing costs in the new loan.

Though with cash-out refinancing, there is a six-month waiting period before you can refinance again.

There is a six-month seasoning requirement for a VA-to-VA refinance. (aka Interest Rate Reduction Refinance, or IRRRL)

Today’s Refinance Mortgage Rates
Now that you know how often you can refinance your mortgage, be sure to take advantage of today’s low rates.

Let The Nation’s Top Trusted Lenders Compete For Your Best Rate!