Bulletin 2023-007 Conventional – Freddie Mac Cash Out Refinance Seasoning Requirement

Conventional – Freddie Mac Cash Out Refinance Seasoning Requirement

Newrez LLC "Newrez" Approved Correspondent Clients; Freddie Mac Bulletin  2022-25  announced a 12 month seasoning requirement for all Cash out refinance transactions.


Cash out refinance transactions not meeting the new seasoning requirements must be purchased by Newrez no later than February 17, 2023.


  • On Non-Delegated transactions a CTC must be issued and loan purchased by Newrez on or before February 17, 2023.


For all cash-out mortgages paying off a first lien mortgage, the following seasoning requirements must be met:


  • The first lien mortgage being refinanced must be seasoned for at least 12 months (measured from the Note date of the mortgage being refinanced to the Note date of the cash-out refinance mortgage
  • Original note date would be validated by the credit report or title commitment



The seasoning requirement does not apply for the following cash-out refinance transactions:


  • Loan proceeds to buy out the equity of a co-owner for an owner-occupied primary residence special purpose cash-out refinance transaction:
    • When property has been jointly owned for 12 months prior to initial loan application; unless parties have inherited or was legally awarded the mortgage premises
    • Fully executed written agreement by borrower and co-owner stating terms of property transfer and disposition of refinance loan proceeds
    • No cash back is permitted to the borrower retaining sole ownership of the property
    • Received an accept AUS decision and meets maximum LTV/CLTV for cash out refinance transactions
  • The first lien mortgage being refinanced is a Home Equity Line of Credit (HELOC)


Freddie Mac will update LPA at a future date to provide new feedback messaging regarding first mortgage seasoning requirements for cash out refinances.


The posted guidelines have been updated in Chapter 1B Transaction Types of the Underwriting Client Guide.