How to refinance a mortgage after forbearance: Waiting periods by loan type

Written by Samantha SheltonNMLS 1647301Updated October 2026

You can’t refinance a mortgage that’s still sitting in an active forbearance plan (you have to exit the plan first) and once you do, Fannie Mae treats you as eligible for a new loan after just three timely, consecutive payments. FHA uses that same three-payment count for a rate-and-term refinance but requires 12 consecutive payments for a cash-out, while VA and USDA don’t use a post-forbearance payment count at all: VA’s clock advances only with payments you actually made, and USDA pairs a 12-month seasoning requirement with a clean recent payment record.

Homeowner on her front steps checking eligibility to refinance a mortgage after forbearance

Forbearance paused your payments; it didn’t erase them, and it didn’t sideline you for a year. What matters now is how you resolved the missed amount and how many payments you’ve made since.

Learn how to refinance a mortgage after forbearance, including which exit path restarts the clock fastest, the waiting period for every loan program, and what can still block approval. For the wider picture, start with our refinancing and home equity guide.

Key takeaways:

Exit the plan first: Lenders don’t refinance loans in active forbearance. FHA requires an open forbearance plan be terminated at or before closing, and a conventional file has to be current on the application date, no more than 45 days since your last paid installment.
Three payments is the common threshold: Once your missed amount is resolved through a repayment plan, payment deferral or modification, Fannie Mae treats you as eligible after 3 timely, consecutive payments, and FHA uses the same 3 for a rate-and-term refinance. An FHA cash-out takes 12.
Reinstating can erase the wait: Pay the missed amount back in full and Fannie Mae treats you as eligible for a new mortgage loan without an added payment count, but the 3 payments can never be bundled into a single lump sum to shortcut the rule.

Can you refinance while you’re in forbearance?

No, with one narrow exception. A loan in an active forbearance plan isn’t being paid as agreed, and every major program is built around that fact. Fannie Mae requires your existing mortgage to be current on the date of the loan application, no more than 45 days elapsed since the last paid installment. FHA requires that a forbearance plan still open at closing be terminated at or prior to that closing. The exception is FHA’s credit-qualifying streamline refinance, which a borrower can use while still in forbearance at case number assignment, provided every mortgage payment was made within the month due for the six months before the forbearance began, with no more than one 30-day late in that window.

Everyone else exits first, and exiting doesn’t erase the debt. As the CFPB’s explanation of mortgage forbearance puts it, forbearance does not erase or decrease the amount you owe; you have to repay any missed or reduced payments. You’ll do that one of three ways, and the one you pick sets your refinance timeline.

Reinstatement: You pay the entire missed amount at once and the loan returns to its original terms. This is the fastest path back, Fannie Mae treats a borrower who resolved missed payments through reinstatement as eligible for a new mortgage loan, with no additional payment count on top.
Repayment plan: You resume your regular payment plus an extra amount each month until the missed balance is caught up. Eligibility restarts after three timely, consecutive payments, or on completion if the plan runs shorter than three payments.
Payment deferral or modification: The missed amount moves to the back of the loan as a non-interest-bearing balance due at payoff, or the terms are permanently restructured. Both are loss mitigation solutions, so the three-payment count applies, and those payments may not be made as a lump sum.

One honest caveat: refinancing isn’t the only exit. If the payment was unaffordable before the hardship, a lower rate may not fix it, and selling a home with a mortgage in forbearance is sometimes the cleaner move. Our overview of refinance situations shows where each option fits.

How long after forbearance can you refinance?

Anywhere from zero to 12 months, depending on your loan type and how you exited. Here’s what each program requires once your forbearance plan is complete.

Loan type and transaction	What has to happen after forbearance	Common sticking point
Conventional, reinstated in full	Eligible for a new mortgage loan with no added payment count.	Requires cash on hand to catch up all at once.
Conventional, resolved by repayment plan, deferral or modification	3 timely, consecutive payments as of the note date of the new loan.	The 3 payments cannot be made as a lump sum.
FHA rate-and-term (no cash-out)	Plan complete plus 3 consecutive monthly payments; 6 payments under a modification agreement if the loan was modified.	A modification resets the count to 6.
FHA cash-out	Plan complete plus 12 consecutive monthly payments; any delinquency in the 12 months before case number assignment forces a manual underwrite.	The longest wait of any program.
FHA streamline, non-credit-qualifying	Plan complete plus 3 consecutive monthly payments, on top of standard seasoning: 6 payments on the loan being refinanced, 6 full months since its first payment due date and 210 days since its closing.	Months you didn’t pay don’t count toward the 6.
FHA streamline, credit-qualifying	Available with fewer than 3 payments, even while still in forbearance at case number assignment, if all payments were made within the month due for the 6 months before forbearance, with no more than one 30-day late.	Needs a clean pre-forbearance record.
VA IRRRL and VA-to-VA cash-out	No forbearance-specific count. Statutory seasoning applies: the later of 6 consecutive monthly payments and 210 days after the loan’s first payment due date.	Skipped months don’t advance either clock.
USDA guaranteed, streamlined-assist	Existing loan closed 12 months before the Agency receives the conditional commitment request, with no mortgage delinquency of 30 days or more in the previous 12 months.	Reported lates during forbearance can break the 12-month window.
USDA guaranteed, streamlined and non-streamlined	Same 12-month seasoning, but the clean-payment window is shorter: no mortgage delinquency of 30 days or more in the previous 180 days.	The 180-day clean window restarts after forbearance.

FHA draws the sharpest line between transaction types.¹ Three consecutive payments after the plan ends gets you a no-cash-out refinance; a cash-out takes 12, and any mortgage delinquency inside the prior 12 months forces a manual underwrite. One detail worth knowing before you assume you’re short on cash: on FHA refinances other than streamlines, the suspended payments from your forbearance are reported on the payoff statement as part of the outstanding principal and interest due, and they’re eligible to be financed into the new loan as long as the maximum mortgage amount for that refinance type isn’t exceeded. See HUD’s FHA loan program overview, and our FHA loan tips for what underwriters check first.

VA is where the internet gets it wrong most often.² You’ll see claims that a VA IRRRL carries no waiting period after forbearance. It doesn’t work that way. Federal law sets VA seasoning at the later of two dates: the date you’ve made six consecutive monthly payments on the loan being refinanced, and the date 210 days after that loan’s first payment due date. Because the statute counts payments you actually made, a month you didn’t pay is a month the clock didn’t move, the position VA stated explicitly about CARES Act forbearance for both IRRRLs and VA-to-VA cash-out refinances. Start with VA home loan and IRRRL guidance, then see what an IRRRL delivers in benefits of refinancing a VA loan.

USDA takes a third approach: no special post-forbearance rule, just seasoning plus a clean recent payment record. All three refinance options require the existing loan to have closed 12 months before the Agency receives the conditional commitment request. What differs is the clean-payment window on top of it: streamlined-assist requires no mortgage delinquency of 30 days or more in the previous 12 months, while the streamlined and non-streamlined options look back only 180 days. Either window can be broken by a late reported during forbearance, so pull a verification of mortgage early. Our USDA loan basics covers the program’s income and location rules.

How to prepare your file after forbearance

Four steps, and the first one takes a phone call. An underwriter reviewing a post-forbearance file is answering one question. Did this borrower recover? , and every document below is evidence toward that answer.

Confirm your exit terms in writing: Ask your servicer exactly how the missed amount was resolved and get the document that says so. This isn’t optional paperwork: where a mortgage shows payments under a modification or forbearance plan in the 12 months before case number assignment, FHA requires the lender to obtain a copy of that plan plus evidence of the amount and date of every payment made under it. If you exited into a permanent restructure, refinancing after a loan modification explains why the count runs from the modification, not the original note.
Verify how the forbearance was reported: A forbearance you agreed to with your servicer generally gets reported according to the terms of that agreement rather than as missed payments, but generally isn’t always. Pull your free reports at AnnualCreditReport.com and check the mortgage tradeline month by month. A 30- or 60-day late sitting on a month your plan covered is far easier to dispute now than three days before closing.
Rebuild reserves and stabilize the payment: Say a Waterford homeowner deferred six payments of $1,450 during a job loss. That $8,700 moves to the back of the loan as a deferred balance, the payment goes back to $1,450, and the escrow account is short because taxes and insurance kept coming due.³ Expect a servicer escrow analysis to raise the payment for 12 months while the shortage is collected, our guide to mortgage escrow accounts shows that math. Budget for the higher number.
Gather the documentation underwriting will ask for: Recent pay stubs and two years of W-2s or returns, two months of bank statements showing the payments clearing, the forbearance or modification agreement, and a short letter of explanation covering the hardship and how it resolved. Check your debt-to-income (DTI) ratio before you apply, since income that hasn’t fully recovered shows up there first.

Hypothetical example, not an offer. Actual rates, costs and payments vary.

What can still block a post-forbearance refinance

Meeting the payment count gets you to the starting line, not the closing table. Four things stop otherwise-eligible files.

An unresolved deferred balance: A deferral moves your missed payments to the end of the loan, but a refinance pays that loan off, so the deferred amount comes due at closing. FHA lets it be financed into a non-streamline refinance within program limits; elsewhere it comes out of proceeds or cash, and it eats into your equity.
New late payments after the plan ended: The forbearance months are usually protected; the months after aren’t. One 30-day late on the new payment restarts your consecutive-payment count from zero and, on an FHA cash-out, disqualifies the file for a full 12 months.
A credit score that slipped for other reasons: Forbearance itself is not a scoring event, but the hardship that caused it often was, a maxed card, a collection, a charge-off. If your score fell in the same stretch, our credit repair strategies cover what moves a score fastest before you apply.
Not enough equity: A deferred balance added back onto the loan can push your loan-to-value ratio past what the program allows, especially if values in your neighborhood flattened. Our walkthrough of how to refinance with negative equity covers what to do when the appraisal comes in short.

What Michigan homeowners should know

Michigan homeowners exiting forbearance have more runway than the mail suggests, and one assistance program that no longer exists.

The state’s pandemic assistance fund is closed: The Michigan Homeowner Assistance Fund, administered by MSHDA, stopped accepting new applications at 11:59 p.m. on December 8, 2023 and is now closed, having exhausted the $242,812,277 the U.S. Treasury allocated to Michigan. It is not an option today.
HUD-approved counseling is still statewide: Michigan has a network of HUD-approved housing counseling agencies that will review your servicer’s exit offer with you, typically at no cost, before you commit to a repayment plan or deferral. That review matters, because the exit path you choose sets your refinance waiting period.
Michigan’s redemption period buys real time: If a file does reach a sheriff’s sale, Michigan law gives most owner-occupied homes of four units or fewer a 6-month redemption period when more than 66 2/3% of the original mortgage debt is still owed; where no shorter period applies, redemption runs a full year from the date of sale. Our overview of the foreclosure process explains where that window sits in the timeline.

How Align handles a hard refinance

Low equity, a credit setback or an unusual property can make a refinance look impossible at one lender and workable at another. Lenders add their own rules on top of the program's.

Samantha takes your file to the wholesale lender whose rules fit it, and if waiting is the better move, she tells you that instead.

Already have an offer from your current servicer or one of the big national lenders you see advertised? Bring us the Loan Estimate. We will compare it line by line and show you where we can do better.

Run a refinance break-even review

FAQ: Refinancing after forbearance

Here are answers to common questions about refinancing after forbearance.

Can you refinance while still in forbearance?

No, in almost every case. Lenders won’t refinance a loan sitting in an active forbearance plan because it isn’t being paid as agreed, and FHA requires an open plan to be terminated at or before closing. You exit first, by reinstating the missed amount, finishing a repayment plan, or having the balance deferred or modified. Eligibility then counts forward from your first payment after that exit, see our guide to refinancing eligibility for the rest of the checklist.

How many payments do I need after forbearance to refinance?

Three consecutive on-time payments is the common threshold for conventional loans resolved through a loss mitigation plan and for FHA rate-and-term refinances. An FHA cash-out requires 12. A VA IRRRL uses seasoning instead of a payment count, so the months you skipped simply don’t count toward the six payments and 210 days the law requires. Details on the FHA option live in our FHA streamline refinance guide.

Does forbearance hurt your credit score?

Usually not by itself. When forbearance is agreed to with your servicer, the account generally gets reported according to the terms of that plan rather than as a missed payment, so scores tend to hold. What does damage a file is missing payments outside the agreement or falling behind after the plan ends. Pull your reports after you exit and confirm the tradeline reads correctly, and if the score did move, refinancing with a low credit score shows which doors stay open.

What happens to the payments I skipped during forbearance?

They still have to be repaid, in one of three ways: a lump-sum reinstatement, a repayment plan spreading the missed amount over several months, or a deferral moving the balance to the end of your loan. Each carries a different refinance waiting period, so it isn’t only a budget decision. Our explainer on mortgage forbearance and what it means for homeowners compares the three exits side by side.

The bottom line on refinancing after forbearance

You can’t refinance a mortgage that’s still in forbearance, but the wait after you exit is shorter than most homeowners assume. Reinstate the missed amount in full and Fannie Mae treats you as eligible right away. Resolve it through a repayment plan, deferral or modification and you’re eligible after three timely, consecutive payments. The same three FHA requires for a rate-and-term refinance, against 12 for an FHA cash-out. VA and USDA use seasoning clocks instead: VA’s six-payment clock only advances with payments you actually made, and USDA wants the existing loan 12 months old plus a clean recent payment record. Which rule applies depends on your loan type and your exit paperwork.

If you’re ready to find out where your payment count actually stands, talk to Align Lending. We’ll match your file to the programs it qualifies for and shop it across our lender network so you can see the numbers side by side. Call 248-506-5727 or start online.

Footnotes:

1. Align Lending is not acting on behalf of or at the direction of FHA or HUD. FHA post-forbearance underwriting requirements are set by HUD in Mortgagee Letter 2020-30 and Single Family Housing Policy Handbook 4000.1 and are subject to change. Return to text.

2. Align Lending works with VA-approved lenders and is not endorsed or sponsored by the Dept. of Veterans Affairs or any government agency. VA loan seasoning requirements are set by statute and VA policy guidance and are subject to change. Return to text.

3. Example figures in this article are hypothetical and for educational purposes only; they do not constitute an advertisement of credit terms or a rate quote under federal or state lending laws. Your payment, deferred balance and escrow shortage depend on your loan, your servicer’s analysis and your local tax and insurance costs. Return to text.

Sources: eligibility for a new mortgage loan after exiting forbearance, including eligibility upon reinstatement and at least three timely, consecutive payments that may not be made as a lump sum when missed payments are resolved through a loss mitigation solution, Fannie Mae, Options After a Forbearance Plan or Resolved COVID-19 Hardship. Requirement that the borrower’s existing mortgage be current on the date of the loan application, with no more than 45 days elapsed since the last paid installment date, Fannie Mae Selling Guide B3-5.3-03, Previous Mortgage Payment History. FHA requirements of three consecutive monthly payments after completing a forbearance plan for purchase and no cash-out refinances, 12 consecutive monthly payments for cash-out refinances, six payments under a modification agreement, termination of an open forbearance plan at or prior to closing, credit-qualifying streamline eligibility with fewer than three payments, streamline seasoning of six payments, six full months since the first payment due date and 210 days since the closing date, exclusion of missed forbearance payments from that minimum, required documentation of the forbearance or modification plan, and eligibility to finance suspended forbearance payments reported on the payoff statement into a non-streamline refinance, HUD Mortgagee Letter 2020-30 and Handbook 4000.1. VA loan seasoning of the later of six consecutive monthly payments and 210 days after the first payment due date of the loan being refinanced, 38 U.S.C. § 3709(c); VA’s statement that CARES Act forbearance periods cannot count toward seasoning for IRRRLs or VA-to-VA cash-out refinances, VA Circular 26-20-25, Change 1 (rescinded July 1, 2021; the statutory seasoning requirement it applied is unchanged). USDA Single Family Housing Guaranteed Loan Program requirement that the existing loan have closed 12 months prior to the Agency’s receipt of a conditional commitment request for the non-streamlined, streamlined and streamlined-assist options, with no mortgage delinquency of 30 days or greater within the previous 180-day period for the non-streamlined and streamlined options and within the previous 12 months for the streamlined-assist option, USDA Rural Development Handbook HB-1-3555, Chapter 6, Paragraph 6.2 and Attachment 6-A. Forbearance does not erase or decrease the amount owed and missed payments must be repaid, Consumer Financial Protection Bureau. Michigan Homeowner Assistance Fund close of new applications at 11:59 p.m. on December 8, 2023, the program’s subsequent closure after exhausting its funds, and the $242,812,277 Treasury allocation to the State of Michigan, Michigan State Housing Development Authority. Michigan redemption period of six months for residential property of not more than four units where more than 66 2/3% of the original indebtedness remains due, and one year where no other period applies, MCL 600.3240(8) and MCL 600.3240(12).

This article is for informational purposes only and is not intended to provide legal, financial, or tax advice. Program rules, waiting periods and payment-history requirements change and vary by loan program, servicer and investor; confirm your figures with your servicer and loan documents and consult a qualified professional about your situation. Figures shown are illustrative, are not a rate quote or an offer of credit, and are subject to change. Align Lending is an independent Michigan mortgage broker, NMLS #2041154.