Will Lender refuse to lend if I Refinanced less than 1 year ago?

Question

For my current primary residence, I want to either obtain do a Refinance Cash-Out or apply for a HELOC and immediately use the entire proceeds of either option along with my cash to purchase my next Primary Residence. However, I was told that I could not use either one of these options (either from the HELOC or the cash-out refi) to purchase my next primary residence if I don't wait at least 1 year because there is a clause which states you have to remain in the property for 1 year.

This sounds absurd. Is there any truth in this????

JD Martin · Answer

In that case you need to look at your mortgage documents and see if you signed anything that stated you would hold the property as your primary residence for one year. If so, I don't see why you couldn't cash out refinance or get a HELOC and use that to buy an investment property, then move into that property once you got past the 1 year hurdle, if the hurdle is that your current residence has to remain your primary residence.

Sam Stabler · Answer

No. Currently, I have a conventional 30-year fixed mortgage. I'm either looking to obtain another conventional 30-yr or a HELOC on my primary residence.

JD Martin · Answer

Depends on what kind of mortgage you have now. VA and FHA have minimum residency requirements. Do you have either of these?