Posted on: 03rd Dec, 2012 01:13 am
i need some advice on a refinance. i have a first mortgage balance of $230,800 at 5.125% and a second mortgage balance of $58,200 at 7.64. so, i now want to go in for a sub-4% rate. credit rating is 740+ and i did a refinance about four years ago to an 80/20 in order to get rid of pmi. at this time, i also got a better rate which lowered my overall payment by about $300 monthly. i would love to refinance if i am eligible. problem is that my home value is probably only around $305,000, meaning my ltv is at 94% (thanks to the crap housing market!). am i better off doing a refi if it means that i have to pay pmi? i am even willing to do a 15 year and pay more, since i can afford more of a monthly payment. i plan to stay in this home for another 7-10 years. any advice is greatly appreciated!
If you can afford to pay the PMI, then you can go for it. However, people prefer avoiding a PMI as it is a added cost over the loan. As you plan to live in the property for the next 7-10 years, then I personally think it is a good option to refinance the loan.
Hi Banzo!
Welcome to forums!
I personally don't think that it will be a good option to refinance your loan and become liable for paying PMI. As Niicss has suggested, it will be an added cost. Unless you build 20% or more equity in your property, you won't be able to get rid of it.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
I personally don't think that it will be a good option to refinance your loan and become liable for paying PMI. As Niicss has suggested, it will be an added cost. Unless you build 20% or more equity in your property, you won't be able to get rid of it.
Feel free to ask if you've further queries.
Sussane
In order to do a refinance you need to show a net tangible benefit of 5%. Feel free to contact us to discuss your scenario in greater depth.
Banzo, you may want to call the servicer of your existing loan to see if the note is owned by FNMA and if so, do you qualify for a HARP refinance. If you do, you can possibly get below a 4% rate on refinancing your first and keep the 2nd as is through a subordination. This would be better than nothing...you can then work on paying of the 2nd quickly by pre-paying on it.