From MLS to Refinance a problem?

[Anonymous]

I was told by Wells Fargo that because my home was for sale and listed on the MLS system about a month ago that i can't refinance my loan for at least 5 more months. Is this true with all lenders? I had never heard of that before. I have a 30yr fixed at 6.78% going to 30yr fixed at 4.87. Please advise.

[Anonymous]

Yes, I have heard this before.  They will not refi a home that is on or has been on the market recently.  Some banks may, but I don;t believe most will.  That is because even if it is your current mortgage lender, they look at the loan as a new file.  If they feel you may be selling the house, you will be paying the loan off with the house sale before they have had time to make any money off the new loan.  Due to that, they don't want to refi on a property on the market or freshly off the market, even more so if you are already in a fixed mortgage currently...  Why do the legwork to refi and such for the home to be sold 3 months later.  Although annoying, it makes perfect business sense.

[ShanetheMortgageMan]

That is Wells Fargo's own guideline, master conforming & FHA guidelines just call for the home to be taken off the MLS - no time period is required.  Lenders put their own time frame requirements.  There used to be lenders who'd do refinance with 1 day off the MLS but the shortest period of time I'm aware lenders are doing is 1 month.  The 6 month requirement is standard with a lot of lenders though.