Three Day Waiting Period For Refinances
There is a mandatory three day waiting period after closing before a refinance home loan can fund. These three days do not include Sundays or Federal holidays and are only applicable to refinances on primary homes. In other words, refinances on vacation homes and investment properties do not have this waiting period and fund the same day as closing.
This three day rescission period is to allow borrowers the time to ultimately determine if they want to finalize their loan and allow funding to happen. This is actually quite crazy when you think about the amount of time and effort that is spent to get to closing. To have someone actually go through the whole process and sign the loan documents at closing only to cancel the loan is nuts. Nonetheless it’s required.
1. If you close your refinance on a Monday then it will become official and fund on Friday (assuming you don’t cancel the loan during that waiting period and assuming there aren’t any holidays in between).
2. In the same manner, if you close your loan on Tuesday your loan won’t fund until the following Monday since the waiting period is Wednesday, Thursday, and Friday – and funding don’t occur on the weekends.
3. If you close on Thursday then your loan will fund the following Tuesday since your three days are Friday, Saturday, and Monday.
4. Last example, let’s use the previous closing of Thursday but now assume that Labor Day is the next Monday. If that’s the case the loan will fund the following Wednesday because the waiting days are Friday, Saturday, (not Labor Day), and Tuesday.