Fannie Mae Seasoning Requirements for Rate and Term Refinance

Under Fannie Mae’s seasoning requirements for a rate and term refinance — formally called a limited cash-out refinance — you generally cannot close the new loan until you have made at least six consecutive monthly payments on your existing mortgage, or until at least 210 days have passed from the original note date. Both thresholds run from the note date of the loan you are replacing, and specific situations — assumptions, modifications, high-LTV refinances, and co-owner buyouts — change which clock controls.¹

The Two Clocks That Run From Your Note Date

Fannie Mae uses two parallel measures of seasoning, and you need to satisfy whichever applies to your situation:

Six full, consecutive monthly payments on the existing loan, each received by the servicer on or before its due date.
At least 210 days between the note date of the existing loan and the note date of the new refinance.

Both are measured from the note date of the mortgage being replaced, not the first payment date and not the day you start shopping rates.¹

A worked example. You close a purchase loan on January 15 with the first payment due March 1. Payments one through six are the installments due March through August. You cannot close the new refinance until that August payment has been made on time and 210 days have elapsed from January 15, which lands around mid-August. The two clocks usually finish close together, but in short months or late-in-month closings one can beat the other. In those cases you wait for the slower one.

When the Clock Restarts: Assumed Mortgages

If you formally assumed someone else’s mortgage, seasoning does not reach back to the loan’s original note date. It starts on the effective date of the assumption agreement, and you need six consecutive on-time payments from that date before a limited cash-out refinance is eligible. Fannie Mae wants to see your payment track record on the debt, not the prior borrower’s.

Refinancing After a Loan Modification

A permanent loan modification complicates things in two ways. First, Fannie Mae generally does not purchase loans that carry material modifications to the original amount, interest rate, maturity date, or product structure.² That restriction is about delivering the modified loan itself. A refinance is a brand-new loan replacing the modified one, so it can still be eligible.

Second, the standard seasoning framework still applies, and lenders will look hard at your payment record under the modified terms. You cannot have any serious delinquencies in the 12 months before the credit report date.³ If your modification is recent, expect the post-modification history to be scrutinized closely.

The 15-Month Rule for High LTV Refinances

Fannie Mae’s High LTV Refinance Program has its own seasoning rule that overrides the standard one. The existing loan’s note date must be at least 15 months before the note date of the new refinance.⁴

The program is designed for borrowers who owe more than their home is worth, or close to it, but have kept up with payments. The tradeoff for allowing very high LTV ratios is a longer wait and tighter guardrails:

The existing loan must be a conventional first-lien mortgage currently owned or securitized by Fannie Mae.
The existing loan’s note date must be on or after October 1, 2017.
At least 15 months must pass between the existing note date and the new note date.

If your loan is not already in a Fannie Mae pool, you do not qualify for this program regardless of your payment history.⁴

The 12-Month Rule for Buying Out a Co-Owner

Using a refinance to buy out a co-owner, which is common after a divorce or the end of a domestic partnership, qualifies as a limited cash-out refinance, but only if the property was jointly owned for at least 12 months before the new loan’s disbursement date.¹ Recently inherited property is excepted from the 12-month requirement.

The money has to flow the right way. The borrower keeping the home cannot receive any of the refinance proceeds; the funds go to the departing co-owner. Both parties must sign a written agreement setting out the transfer terms and how the proceeds will be distributed, and the borrower who ends up with sole ownership must independently qualify for the mortgage under Fannie Mae’s standard underwriting guidelines.¹

Payment History: The Second Gate

Seasoning counts the months since your loan closed. Payment history evaluates how you performed during those months, and the window Fannie Mae looks at extends beyond the six-payment seasoning period.

Your existing mortgage must be current on the date you apply, meaning no more than 45 days can have passed since the last paid installment. Fannie Mae defines excessive prior mortgage delinquency as any 60-day, 90-day, 120-day, or 150-day late payment reported within the 12 months before the credit report date.³ A single 60-day late in the past year can disqualify you even if every other payment landed on time.

This is where many refinance applications quietly fail. Borrowers focus on whether they have waited long enough without checking whether their payment record is clean enough. Both gates have to open.

When a Fast Refinance Gets Reclassified as Cash-Out

Seasoning matters because stepping outside the limited cash-out box pushes you into cash-out territory, which carries tighter LTV limits and stricter rules. Two scenarios do this on timing alone.

First, if you combined a first mortgage and a non-purchase-money second mortgage into a new first mortgage, that transaction, and any refinance of it within six months, is automatically classified as a cash-out refinance.¹

Second, paying off a non-purchase-money second lien, such as a HELOC you drew on for a renovation, as part of the new refinance also moves the transaction into cash-out, no matter how little cash you walk away with.¹ A purchase-money second (a piggyback you took out alongside your original mortgage) can be paid off inside a limited cash-out, provided the lender documents that the full amount of the subordinate financing went toward the purchase.

Separately, the cash you can actually receive at closing on a limited cash-out refinance is capped at the greater of 1% of the new loan’s unpaid principal balance or $2,000. Refunds of prepaid items, like leftover escrow money, do not count toward that limit.¹ Needing more cash back than the cap allows also forces the lender to treat the whole transaction as cash-out.

If your situation does not fit any of the special cases above, the short answer stays short. Six on-time payments or 210 days from the note date, a clean 12-month mortgage history, and a loan that is current on the day you apply.

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Fannie Mae. Limited Cash-Out Refinance Transactions
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Fannie Mae. Loan Eligibility
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Fannie Mae. Previous Mortgage Payment History
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Fannie Mae. High LTV Refinance Loan and Borrower Eligibility