HUD released an update recently that made 12 months seasoning mandatory for those homeowners who want to refinance their conventional loan into an FHA loan.
(The following only applies only to refinances of existing conventional loans into FHA loans)
- The subject property must have been owned by the borrower as his or her principal residence for at least 12 months preceding the date of the loan application.
- If said property is encumbered by a mortgage, the borrower must have made all of his/her mortgage payments within the month due for the previous 12 months, i.e., no payment may have been more than 30 days late and is current for the month due.
- The property that is security for the refinanced mortgage must be a 1- or 2-unit dwelling.
Any co-borrower or co-signer being added to the note must be an occupant of the property. Non-occupant owners may not be addedin order to meet FHA's credit underwriting guidelines for the mortgage.
So this means that if you have a new mortgage on your property for less than 12 months, you will have to wait until you can refi into an FHA product (if you currently have a conventional loan)
Remember that if you currently have an FHA product in place, this rule does not apply to you!
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