Seasoning
The minimum amount of time a property must be owned or a loan must exist before a lender will refinance or lend against it.
Definition
Seasoning refers to the minimum holding period lenders require before they'll provide financing or allow a refinance. Conventional lenders typically require 6–12 months of ownership seasoning before doing a cash-out refinance. Some lenders require that a property's title be seasoned for a year before they'll lend against it at all.
In the BRRRR strategy, seasoning requirements determine how long you're stuck with the hard money loan after renovation. If your conventional lender requires 6-month seasoning, your hard money timeline (and costs) must account for that waiting period.
Title seasoning affects wholesalers too — buyers using FHA or conventional financing may be unable to purchase a property that was just acquired by the seller, due to lender 'anti-flipping' seasoning requirements. Working with investors or cash buyers avoids this issue.
Related Terms
BRRRR Method
Buy, Rehab, Rent, Refinance, Repeat — a strategy to recycle capital into multiple rental properties.
Refinance
Replacing an existing loan with a new loan — often to access equity, lower the rate, or change loan terms.
Hard Money Loan
Short-term, asset-based loans from private lenders — used for acquisitions and rehabs when speed matters.
Loan-to-Value (LTV)
The ratio of a loan's balance to the property's appraised value, expressed as a percentage.
Title
Legal ownership rights to a property — the bundle of rights that come with owning real estate.
Also in "S"
Seller Financing
A transaction where the seller extends credit to the buyer, eliminating the need for a traditional bank loan.
Short Sale
A sale where the lender agrees to accept less than the full balance owed on the mortgage.
Subject-To
Buying a property 'subject to' the existing mortgage — the deed transfers but the loan stays in the seller's name.