We are not aware of any law or regulation that requires a borrower to have purchased their property at least six months before obtaining a cash-out refinancing. Likewise, we are not aware of any requirement for a lender to obtain a “24 month chain of title” report prior to a refinancing.

However, we do note that Fannie Mae and Freddie Mac generally require a borrower to have purchased or acquired the financed property at least six months before being eligible for a cash-out refinance transaction, with certain exceptions. In addition, it is our understanding that lenders often require a “24 month chain of title” report for a cash-out refinancing transaction. However, to our knowledge, neither is required by law.

For resources related to our guidance, please see:

• Fannie Mae Selling Guide, Cash-Out Refinance Transactions (July 25, 2017) (“Cash-out refinance transactions must meet the following requirements: . . . The property must have been purchased (or acquired) by the borrower at least six months prior to the disbursement date of the new mortgage loan except for the following: (1) There is no waiting period if the lender documents that the borrower acquired the property through an inheritance or was legally awarded the property (divorce, separation, or dissolution of a domestic partnership). (2) The delayed financing requirements are met.”)

• Freddie Mac Single-Family Seller/Servicer Guide (July 6, 2017) (“Cash-out refinance Mortgages . . . At least one Borrower must have been on the title to the subject property for at least six months prior to the Note Date, except as specified below. If none of the Borrowers have been on the title to the subject property for at least six months prior to the Note Date of the cash-out refinance Mortgage, the following requirement(s) must be met: (1) At least one Borrower on the refinance Mortgage inherited or was legally awarded the subject property (for example, in the case of divorce, separation or dissolution of a domestic partnership) (2) OR all of the following: The Settlement/Closing Disclosure Statement from the purchase transaction must reflect that no financing secured by the subject property was used to purchase the subject property. . . .”)