Seasoning is how long you have to own a property before a lender will refinance it on the new appraised value. Many lenders require 6 to 12 months. On select HomeShield Rental programs, you can refinance on the full appraised value in as little as 3 months, or refinance right away based on what you paid plus your rehab costs.
What seasoning means
BRRRR stands for buy, rehab, rent, refinance, repeat. The refinance is where the strategy pays off: you replace the short-term rehab loan with a long-term rental loan based on the improved value, and pull your cash back out for the next deal.
The catch is seasoning. Many lenders won't use the new appraised value until you've owned the property for a set period, often 6 to 12 months. Until then, they cap the loan at what you paid. That leaves your cash stuck in the property and slows down the next deal.
Your options with HomeShield
- Refinance right away. No waiting period when the loan is based on what you paid plus your documented rehab costs.
- New value in as little as 3 months. After as little as 3 months of ownership, refinance on the full appraised value on select programs.
- Flipping with us first? No seasoning is required when you move from our bridge loan to one of our rental loans on qualifying programs.
Cash-out refinances go up to 75% of the appraised value for qualified borrowers. Loan amount and leverage limits apply, and terms vary by program.
Ready to refinance a rehab?
Tell us what you paid, what you put into it and what it rents for.
How to set up a smooth BRRRR refinance
- Keep every receipt. If you refinance early on cost, your documented rehab spending sets the loan amount.
- Get it leased. A signed lease at market rent helps the DSCR. A vacant property can still qualify on the appraiser's market rent estimate.
- Plan the refinance before you buy. Knowing the rental loan you'll use helps you pick the right rehab loan.
- Check the DSCR. The new loan qualifies on rent versus payment. See what a DSCR loan is.
Frequently asked questions
Can I do a cash-out refinance right after buying?
On select programs, yes, based on what you paid plus documented rehab costs. To use the full appraised value, you'll generally need at least 3 months of ownership on our programs.
How much cash can I pull out in a BRRRR refinance?
Cash-out refinances go up to 75% of the appraised value for qualified borrowers, depending on the program, credit and property.
Do I need a tenant in place to refinance?
No. A lease helps, but if the property is vacant, the appraiser's estimate of market rent can be used to qualify.