FHA Refinance After 1 Year

[Ben Morand]

Hey everyone! Quick question about refi's since I've never gone through with one before.

Context: I graduated college April 2022 and set out on my real estate journey. I own a management company and am making enough income to qualify for a conventional loan. I also have excellent credit (around 800). Only thing keeping me away from the loan is work history. My business has been operating for just 1 year now (as of this month) and this will be my first tax return for it. I do not have a W2 job outside of the business, so I am planning on approaching my parents to co-sign with me on an FHA loan to house hack a property, utilizing their W2 work history to qualify.

Question: They would likely be open to co-signing with me. However, they wouldn't want to be tied to it for longer than they need. My question is, would I be able to refinance to take them out of the loan in some capacity after 1 additional year (since I'd then have 2 years of business tax returns)? Most likely, there would not be much forced equity in the property, so I don't think the refi would be into a 20% down conventional loan. I'm just not sure if I'd be able to refi into another FHA, or even a lower DP conventional loan after just 1 year, or if I'd have to wait to reach 20% equity to take them out of the equation.

Hopefully this makes sense and I am really looking forward to any insight. You guys rock, thanks a million!!