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Old 02-14-2014, 11:45 AM
 
Location: Southern California
4,350 posts, read 4,939,435 times
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At 3.625 with MI, you can't get much better. Unless you pay off a large chunk, there'd be no benefit to refinancing. Save your $100 a month, you might need it when you sell.
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Old 02-14-2014, 06:47 PM
 
279 posts, read 111,016 times
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Quote:
Originally Posted by thelopez2 View Post
At 3.625 with MI, you can't get much better. Unless you pay off a large chunk, there'd be no benefit to refinancing. Save your $100 a month, you might need it when you sell.
Thank you. Much appreciated.
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Old 02-15-2014, 09:10 AM
 
165 posts, read 266,936 times
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Originally Posted by thelopez2 View Post
I don't know if they will make PMI deductible again.

It is very unusual for the 2nd to not subordinate but it is their right. When the lender said your couldn't go conventional without paying off the second, it makes me think that you don't have enough equity to do a cash out refinance. It sounds like you used a second to buy the home, last year I refinanced a 1st and 2nd into a new 1st 85% loan to value loan and it wasn't treated as a cash out refinance. You probably did a streamline with no appraisal, so you didn't know the value of your house.

I'd consider looking for another lender and checking on conventional rates and not paying PMI. An ARM would save you a lot monthly but your balance would probably go up quite a bit and you won't make your money back for a couple of years. It is very hard to offer suggestions without knowing the property value and loan amounts.

Some lenders consider if the 2nd was done at time of purchase it can be done as "purchase money" and not cash out.
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Old 02-16-2014, 09:13 AM
 
Location: Southern California
4,350 posts, read 4,939,435 times
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Quote:
Originally Posted by thelopez2 View Post
I refinanced a 1st and 2nd into a new 1st 85% loan to value loan and it wasn't treated as a cash out refinance.
I though I did stated by example not everyone will treat it as a cash out refinance.

Quote:
Originally Posted by sockruhtese View Post
So you're saying that I could refi again into a conventional loan with no PMI? Even though the 2nd mortgage lender won't subordinate?

Right now, the value is about 215k (based on recent sales). My refi'd FHA with PMI 1st mortgage balance was 189k. It's currently 186k (at 3.625%). I pay about $190 in PMI each month. The conventional without PMI 2nd mortgage balance is currently 6K (at 5.25%). My payments go to VHDA.
You wont need to subordinate if you pay the 2nd off.
Based on what you stated you are at 86.5% LTV and 89% CLTV you might be able to find a lender that will give you a 90% LTV loan with PMI or a higher rate to cover them paying the PMI for you.

Rates have gone up to over 4%, if you took a conventional at over 4% with PMI, you might have a lower monthly payment but your loan balance not not go down as much as if you kept the 3.65% loan. This will eat into your profit when you sell in a couple of years. You need an experienced person to work out your specific numbers and PMI cost based on your credit score.

Quote:
Originally Posted by sockruhtese View Post
No, I never did an ARM. All fixed. I was mistaken earlier when I said I refi'd to 4.25. It was actually 3.625.
The only way you'll get close to that rate today is with an ARM and you are going to have to pay upfront to get that rate, not a good idea if you are selling in a year or 2.

The only way to know if you can save money is to get your stuff together and apply for a loan, have them pull your credit and get an appraisal done.

I never addressed the cost saving of going from non deductible PMI to deductible interest, since it is very specific and you'll need to work that out with your accountant.
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