Mortgage refinance

Yes it would likely be a good idea to refinance and drop that rate down to 4.25% depending on your loan amount and how long you plan to keep the property. The UFMIP is currently 2.25% but since you took out your FHA loan so recently you will recieve a credit from the original UFMIP you paid last year.

Thank you Nic! For your quick reply on this, I appreciated it.

My UPB is around 535K and property may appraisal to 610– 635k, I have plans to live in this house next 5 years minimum, I believe.

The other question I have is , since my LTV is about 85% , so I need to pay PMI as well , so when my LTV reaches less than 80% , does FHA automatically removes PMI from my loan? Or do I need to do a appraisal in order to remove PMI from my loan? or is there separate process to remove PMI for FHA loans?

Thanks
Dan

With 30 year FHA loans MI is required for the first 60 months regardless of LTV. Could you possibly afford a 15 year ammortization? If so, at 85% LTV you would not be required to have the MI monthly.

What state and county are you located in?

Nic

I am located in Alameda county in CA.

Thanks
Dan

With 15 year ammortization , do i need to pay UFMIF of 2.5%?

As far as I can understand, you will have to pay the UFMIF of 2.5% though it's a 15 year amortization.

If you take a 15 year FHA loan at 90% or less LTV, you will pay no mortgage insurance but you will still have to pay the 2.25% Up Front Mortgage Insurance Premium. If you wait until after September 7, 2010, your UFMIP will only be 1.25%. Make sure you speak to a licensed California loan officer who is experienced with FHA mortgages.

Dan,

Your best bet would be to shoot Greg (who posted above) an email or give him a call to discuss your options as he is there in California as well and knows FHA guidelines very well.


Best of luck

Thank you all for you inputs on this.

Greg , will wait till september to discus with you on this further.

Thank much

Dan.

Yes, Right now is a great time to refinance. With record low rates and a hurting economy, it seems to be a good decision to think about investing some time in finding out if refinancing can help lower your monthly payments. Contact your local lenders and check online resources to see if this is a good option for you. Your monthly payment could be lowered significantly.

You can talk to Greg later, but the change to UFMIP from 2.25% down to 1.000% was changed from September 7 to October 4, so, you wait longer.

The longer you wait, the less the refund on your existing UFMIP.

Also the longer you wait, the rate could be different---lower is ok and higher would be worse.

If you are doing 15 fixed, maybe worth the wait as you have no monthly MIP payment. The monthly MIP for 30 fixed is increasing to 85 to 90 bps points. That means if you wait, your add on for UFMIP will be less, but the net result is that your monthly payment will be higher.

Six of one and a half dozen of the other.


If refinance to 30 fixed, maybe do it now.

If refinance to 15 fixed, maybe wait until after Oct 4.

Either way, the time to talk to Greg is now to wet up the proper game plan.

Thank you all for your input. much appreicated.

Hello There,

Is Monthly PMI is tax deductable?please advise.

Thank you

Dan.

Hi danardenwood!

Welcome to forums!

The PMI that you pay is tax deductible. The Congress has extended tax deductions for homeowners paying PMI through 2010.

Feel free to ask if you've further queries.

Sussane