How Soon Can You Refinance a Home After Purchase?

Home refinance both have positive and negative results. If done correctly with exact knowledge and understanding about this matter, borrowers can enjoy the benefits of refinancing. To lock in a new favorable rate is a good idea. Others have better reasons in mind and might be excited about achieving those goals by refinancing. If you have just bought your house and you feel the need to refinance it for some reasons, you might wonder how soon can you refinance a home after purchase.

There’s no exact time frame for refinancing. It all depends upon your current mortgage guidelines. Your current lender might have included a prepayment penalty. It means that you have to pay the penalty for early repayment or refinancing. Some lenders will allow you to waive this if you are having the refinance through them. This reason is why it’s important to talk with your lender before you start the refinance paperwork.

It also might depend on the amount of money initially borrowed. The bank may or may not let you create a new loan. One example is that if the original loan was 70% of the home’s value, but the new refinance would be for 78% due to a decline in the market, the bank would be catching on a less stable loan. The payment and the interest rate of this loan will most likely be higher. Other factors that might include whether you can and should refinance immediately comprises the following:

If you find out that the factors listed above can significantly impact your decision about refinancing your mortgage after your purchasing, you better think twice pursuing this financial step. Consult with your trusted financial adviser about how soon can you refinance your home after purchase.

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