Seasoning is the rule that keeps BRRRR investors waiting. Most conventional investment property refinances require you to own the property for 6 to 12 months before the lender will use the current appraised value (the ARV) as the basis for the loan. Before the seasoning period ends, the lender uses the lower of purchase price or appraised value, which defeats the whole BRRRR strategy because you cannot pull out the equity you created through rehab. DSCR loans are more flexible and some allow no seasoning or as little as 3 months. Delayed financing is another option for cash purchases, letting you refinance at appraised value within 6 months of the purchase date without the standard seasoning wait. Always ask your lender about seasoning requirements before you buy because they directly determine how fast you can recycle capital. A 12 month seasoning period is a very different deal than a 3 month one.
Example
You buy a property in February for $55,000, rehab it for $30,000, and place a tenant in May. Your lender requires 6 months of seasoning. You can refinance starting in August based on the new ARV, not February's purchase price.