If you own a home, have tried to sell it and have decided to take it off the market for whatever reason – be ready for the lender to have some specific guidelines if you want to refinance the home anytime soon.
Guidelines for recently listed properties that the owner now wants to refinance will vary by lender, but as a general rule there are some things that are commonly required in this situation.
Cash Out Refinances After A Property Has Been Recently Listed
If you have had your home on the market, something changed and it has recently come off the market and you are now wanting to do a cash-out refinance, be ready for the lender to require that the property has been off the market and the listing canceled at least 180 days prior to the origination of the loan.
180 days for a cash-out refinance is quite a bit longer than the waiting period for a “rate and term” refinance – but it is largely because the lender wants to make sure that their risks are covered. Be ready to provide a letter of explanation as to why you had it on the market and why it is now off the market. Also be ready to provide a copy of the canceled listing and a current MLS search must be done to verify the property is not currently listed by a different real estate agency.
Rate and Term Refinance For Recently Listed Properties
Some lenders will now allow a refinance for a recently listed property as long as the property has been off the market for at least one day prior to the loan application being filled out.
As with a cash-out refinance, expect to be asked to provide a copy of the canceled listing for the underwriter and expect the underwriter to do an MLS search to verify that the property is not currently listed by a different real estate agency.
Expect the appraisal to be required to show the property is not currently listed for sale, be ready to provide evidence that you are occupying the property and be willing to provide a letter of explanation outlining your intent to occupy the property, the reason you listed the home for sale and why you are now interested in refinancing.
If you have recently listed your property for sale and are now interested in refinancing – be aware that more documentation is going to be required. It won’t be impossible to get done – just more difficult. As always, work with your loan officer for answers to more questions.
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