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Short answer is yes.
A mortgage loan that young should be due for the first payment, so make it, because if you don’t it will show when the refinance lender requests an accounting or payoff statement. Each lender may have its own underwriting requirements that in many respects are driven by the secondary mortgage investor market. The guidelines are also driven by whether your “lender” is a mortgage debt investment conduit, a mortgage banker with its own or borrowed money, a federal savings bank, a credit union or a national association bank. Other factors may include whether your new lender is underwriting you with a Fannie Mae or Freddie Mac guideline or using HUD mortgage insurance (FHA) guidelines. Mortgage insurance guidelines may also dictate, depending on your level of equity and the loan to value ratio of the proposed transaction.
Bear in mind, that in general a refinance will take 102% to 104% of the existing balance to be refinanced, which will include all the interest accrued to the expected date of payoff, plus fees to record, appraisal costs, credit fees, potential discount points, origination fees (no one works for free) and so on.
Before you refinance, ensure that net benefit is solid to you.
Most mortgages these days do not have a penalty for refinancing quickly. However, internally the company that helped you with the mortgage or now owns (services) your mortgage – where you make your payments – might have an internal policy that would be a disincentive for a loan officer there to work with you on refinancing again so soon. If there was nothing in the mortgage paperwork about a prepayment penalty (which would be very unusual today) and you should be able to sell or refinance any time. I personally have started the refinance process again the same month I had just closed on the last loan because rates had improved enough and the costs were minimal.
The real question is whether the costs of refinancing again so soon make sense. What are the costs involved vs. the monthly savings and that will vary based on the state and the lender. If you’re going to save $100 a month but your costs (lender plus attorney or title company charges) are $4200 it essentially would take you 42 months (3.5 years) to pay yourself back the costs for refinancing and you should make that calculation whether you are adding the costs back into the mortgage or paying them in cash yourself. However, if the lender can offer you the opportunity to refinance with relatively minimal costs involved, the decision is relatively easy.
Don’t forget to consider how long you expect to stay in the house when you consider refinancing. If you are hoping to sell and move to a different home within 3 years if it would take you 3 years to recover the costs of refinancing it really probably does not make sense.
We have a mortgage that is 1 month old. We do not have prepayment penalty and no mention of soft or hard penalty in contract either. Can I refinance with another lender? Is there any waiting period before a lender would allow refinance?