Sell after Cash out Refinance, Primary Residence?

[Justin C Huggins]

My wife and myself purchased a home that was somewhat a fixer upper.  We have lived in the home ever since we bought it last year and have done several repairs and upgrades to the home.  We have recently had a cash out refinance to help cover the money we put into the house along with some extra.  Our plan was live in this home indefinitely, but now we have found some other homes that were potential homes for us, as we were searching for our next rental.  This brought up all kinds of conversations about better school districts for daughter and so on, needless to say we are considering moving again, if we are allowed to do so!  I don't want to cause any issues and we will stay in the house for a year if needed.  I know I am not able to rent the home for 12 months, but is there any stipulations on selling the home?    The home was refinanced with conventional loan as primary residence.  

[Jeff Dulla]

@Justin C Huggins There typically aren’t prepayment penalties or anything like that with conforming loans. I don’t know the legality of whether or not you actually sign something in the note or mortgage that says you won’t sell for 60 days.

What I can tell you is that mortgage bankers and brokers have something called an EPO. Basically if you sell within, generally speaking, six months, that company loses all revenue and closing costs that they covered on your loan. It’s a huge loss. 

It stems from the end bank needing to service your loan for a certain period of time in order to breakeven on it. You may not feel bad for the big banks but when they lose, it’s the little people underneath them that really lose. The big bank will come after the broker/mortgage banker for those losses. Hopefully this all makes sense.