Refinancing can have many benefits, including securing a lower interest rate, reducing your monthly payment, or paying off your loan faster.
But refinancing isn’t an option for every homeowner. Depending on what type of loan you have, you may be able to refinance immediately after closing — or there may be a waiting period.
Are you thinking about refinancing your mortgage? Here’s how soon you can do it for each type of mortgage.
Key takeaways:
- The length of time you need to wait to refinance depends on your existing mortgage type
- Some loan programs have no waiting periods, while others require you to wait six months up to a year
- Even if you reach that point, it may not be the right time to refinance due to interest rates or other factors
Refinance Timelines by Loan Type
Every mortgage program has different refinancing rules. For conventional loans, you can typically refinance right away, while government-backed loans require anywhere from six months to a year.
See below for a more detailed look at how long you’ll need to wait to refinance your specific type of mortgage loan.
Conventional Loans
Generally speaking, you can refinance a conventional loan whenever you’d like — even immediately after closing. Some lenders may charge a prepayment penalty for refinancing too soon, though, and individual lenders can also require “seasoning” — a waiting period if you want to refinance with them. Refinancing with a different lender can help you avoid these waits.
For a conventional cash-out refinance, the existing first mortgage must be 12 months old except when
- The loan is a subordinate or second lien
- You’re buying out a co-owner as part of a legal agreement
FHA Loans
With Federal Housing Administration (FHA) loans, there are specific waiting periods for each type of refinance. For FHA streamline refinances, which allow you to refinance one FHA loan into another, you’ll need to wait at least 210 days and make six on-time mortgage payments.
Traditional FHA rate-and-term refinances require a six-month wait from your initial closing date, while FHA cash-out refinances also require a six-month waiting period, and you must have owned your home for at least one year.
If you inherited a home, you don’t have to wait 12 months before doing a cash-out refinance. However, if you have rented out the home since it was inherited, you must occupy the home as your primary residence for 12 months before being eligible for an FHA cash-out loan.
USDA Loans
U.S. Department of Agriculture loans — USDA loans, for short — require at least 12 months of on-time payments before you can refinance into another USDA mortgage. These loans are only for use on properties in certain rural and suburban parts of the country. Cash-out transactions are never allowed.
VA Loans
VA loans — loans backed by the U.S. Department of Veterans Affairs for military members and veterans — require you to wait 210 days from your original closing date, or you need to have made six on-time monthly payments (whichever comes later). This waiting period applies to all types of VA refinances, including VA IRRRLs (Interest Rate Reduction Refinance Loans) and VA cash-out refinances.
When to Refinance
Timing your refinance is key if you want to get the most benefit from it. While your loan program’s waiting period will certainly play a role, there are other factors to consider, too.
Mortgage rates
For one, you’ll want to look at interest rates. If you’re looking to reduce your interest costs and monthly payments, most experts say refinancing to a rate of 0.5% to 1% lower is the goal to target. Though mortgage rates fluctuate often, it can take months for a dip of this size to occur. For example, in 2024, it took from May to September for average mortgage rates to fall from just over 7% to just over 6%, according to Freddie Mac. You can keep an eye on mortgage rate trends by using our rate tracking tool.
Here’s a quick look at how refinance rates have been trending:
How we source rates and rate trends
Rates based on market averages as of Dec 02, 2025.Product Rate APR 30-year Fixed Refinance 6.35% 6.37% 30-year Fixed Fha Refinance 5.56% 6.77% 30-year Fixed Va Refinance 5.68% 5.82% 30-year Fixed Usda Refinance 5.56% 5.70% 30-year Fixed Jumbo Refinance 6.82% 6.84%
Breakeven point
You should also look at the breakeven point on the refinance to determine if it’s the right time to refinance. The breakeven point is the month in which your refinance will save you more than it costs.
According to Freddie Mac, the average refinance costs about $5,000. If a refinance would save you $250 per month, then you’d break even on those costs in 25 months — or just over two years. If you don’t think you’ll be in the home long enough to reach that point, it’s probably not a good time to refinance.
Financial needs
Your financial needs dictate when you should refinance, too. For example, if cash is tight at home, you might want to refinance into a longer term to reduce your payments. Or, if you come into some extra cash, you might think about refinancing into a shorter loan, which would give you higher payments but allow you to pay off your loan sooner.
What to Know Before You Start
Before you opt to refinance, make sure you know what you’re getting into. Not only does refinancing come with upfront costs (about $5,000, Freddie Mac estimates), but it requires filing an entirely new loan application, too. That means you’ll need to provide financial documentation, submit to a credit check, have the house appraised, and go through the entire loan process again, which usually takes at least a few weeks.
Make sure you understand the changes that will come with your new loan as well. Your payment, due dates, payoff timeline, and other major details may change, and it could impact the long-term costs of your loan as a result. Always have a loan officer run the numbers to ensure you have a good grasp on what the refinance will mean for your pocketbook.
How Early Is Too Early to Refinance?
When you first take out a mortgage, the majority of your payments go toward interest. It’s not until later into the loan term that you start making a real dent in the principal balance.
Because of this, refinancing too early could mean spending more time in that high-interest period than you’d like — and potentially paying more toward interest in the long run.
Refinancing too soon might also mean little difference in interest rates, or, because you’ve built up little equity and your credit score is lower (this happens when you take on new debt), you could even get a higher interest rate.
Finally, it also means doubling down on closing costs. And if you don’t plan to be in the home for the long haul, that might not be worth it, financially speaking.
On the other hand, refinancing early in your loan means you don’t reset your loan back to 30 years after paying on it for multiple years. For example, it could be better to refinance a loan with 29 years left into another 30-year mortgage than it is to refinance a loan with just 25 years left.
Our Take: The Right Time to Refinance Varies Widely
Many mortgage programs have waiting periods before you can refinance your loan. But even once you reach these thresholds, it doesn’t necessarily mean it’s in your best interest to refinance.
Consider factors like closing costs, the interest rate you’d qualify for, your financial situation, and other details when deciding when to refinance, and if you’re still not sure, consult a loan officer for professional guidance. They can help you make the best decision for your goals and budget.
Fact-checked by Tim Lucas.
