Seasoning period for cash-out refiance with a paid off property?

[Matt Wells]

How long is the seasoning period to do a cash-out refinance into a conventional mortgage if the property is completely paid off? I've read somewhere that it is usually six months but doesn't specify if that 6-month seasoning is for homes currently in a mortgage or homes that are paid off.

[Joe Villeneuve]

The answer is both.  If you buy a house all cash, or partially cash, the reason for the 6 month seasoning is the same.  It takes 6 months for the bank/appraisal to allow for an increase in property value.  In other words, even if you bought the property half off, the property value is equal to the purchase price for the first 6 months.