Does it make sense to refi? (PMI, loan, 2013, credit score)

[ngwira]

We bought in dec 2013. Fha loan 30 year fixed 4.25 rate butwith mortgage insurance for life our real rate (APR)is closer to 6 percent. Mortgage insurance is $200 per month. Payment is $1611 per month.
Refinance would bring rate to 4 percent conventional and payment to $1467 per month but closing costs are 5k. This is a 25 year loan.
Should I refi? Credit score is 787. Or wait until we have more equity?
Thoughts?

[schoolofhardknocks]

Doesn't sound like there's a benefit in refinancing.

[ngwira]

We would be borrowing 177k and home is worth 195k.

[ngwira]

Originally Posted by schoolofhardknocks

Doesn't sound like there's a benefit in refinancing.

Not worth it to get out of fha and into conventional?

[ngwira]

Anyone else have an opinion?

[Copanut]

Doesn't seem like you would be saving much and the 5k might be better spent elsewhere. Has there been an increase in value in one year to drop PMI? Do you plan on staying there more than 5 years?

[ngwira]

I don't think that the value has increased very much. We cannot drop pmi because we are in an fha mortgage where pmi is for "life".

[Copanut]

I would hold off until your equity increases.

[thelopez2]

Can you put the the $5000 into the loan? How long to you plan to live in the house?

[ngwira]

I can do that but it would increase the loan balance which I don't want to do. I think we will just wait until our equity increases then refinance into a 15 year fixed with no pmi.

Our payment is manageable right now.