Avoiding ownership seasoning on a refinance

[Clint G.]

I purchased a few rental houses about six years ago, and want to refinance them to take advantage of these low rates. The deeds are in the name of my LLC now, but if I re-deed the properties in my personal name, I can get a good rate on the mortgages (that's what the broker is telling me.)

Here's the problem: I'm being told I have to wait 6 months after re-deeding before I can refinance. They're calling it an "ownership seasoning" period.

Can anyone provide any insight on this 6 month "ownership seasoning" requirement, and maybe give me some suggestions on how I can avoid it? Is it a federal requirement, or is it just a "good business practice" that bankers adhere to? I'd really, really like to take advantage of these rates, and I'd like to start saving money NOW instead of 6 months from now...

Many thanks.

[Jon Holdman]

You best bet is to start speaking with lenders and mortgage brokers in your area. We don't know enough about your personal situation to speculate.

I've not priced a loan in a couple of months, so I'm not sure exactly where rates are. If you see ads for 30 year fixed mortgages, assume those are for OO borrower with stellar credit and low DTIs. If you have plenty of cash in the bank for reserves, 750+ credit, and enough income to keep your DTI low (don't know how low, maybe under 40-45%?), you will end up with four or fewer mortgaged properties, and you're refinancing at 70% or lower LTVs you should be able to get about a point higher than those advertised rates. Miss on any of those criteria and you rate is going to be higher.