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Can I refinance into a conventional loan with no PMI if I have 85% LTV and excellent credit?

My current loan is $252k. The house is worth $292k. I currently have an FHA loan at 5.375%. My credit score is 780. Is there a lender out there that will take on my mortgage with no PMI with only 85% LTV?

  • July 03 2010 - Pleasanton
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Answers (17)

Profile picture for Clearpoint

July 03 2010?? 

  • February 18 2014
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That's an easy task.. We would just refinance it at 80% LTV and piggy back an interest only HELOC for the 5%. It should get your payments down quite a bit.
  • February 18 2014
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Don't hold your breath, this post is 3.5 years old
  • February 18 2014
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How confident are you in that value? Have you had an actual appraisal completed on the property or are you looking at on-line estimates? There are no "one loan" at 85% with no PMI unfortunately. It is either up front like you have now or as some others have mentioned there is lender paid MI, which means you pay for it in a higher interest rate so you are still paying for PMI in that case. A 5% HELOC/second mortgage would be relatively small based on your total amount owed, therefore if you are in fact at 85% an 80% first mortgage & 5% second could be your most cost effective option depending upon your specific qualifications. You really should contact a Mortgage Professional that can provide you with options and analysis to really determine what is best for your individualized scenario. Please visit my profile and let me know if you need any additional help. All the best!
  • February 18 2014
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 lender paid mortgage insurance program.
============
How is that not PMI?
  • February 18 2014
  • 1Yes

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Yes you most certainly can. You actually have a couple options to chose from. In your case you could chose to go with a lender paid mortgage insurance program. Although it does come at a slightly higher interest rate. You could also consider doing a piggyback scenario where you have an 80% 1st and a small 5% 2nd. This second option is in my opinion the better of the 2 as it will allow you to obtain a much lower interest rate on the 1st. And that small piggybacked 2nd could be paid off quickly leaving you with only the 1st.

Please visit my Zillow profile and contact me if you have any further questions. Good Luck!
  • February 17 2014
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I hope you don't mind me asking, how does the OP get out of High MI on an FHA streamline? I must have missed something, big.
  • May 30 2012
  • 0Yes

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This isn't the answer you are looking for but there is a new Streamline FHA refinance that could get you out of the high MI payment and probably a 4% or better rate. I just ran a payment calculation and it would be about $1318 - $1375 not including taxes and insurance. Let me know if I can help. We can do loans in all states. Thanks,

Kathy Funke

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  • May 30 2012
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There are many variables to consider when reviewing your refinance options.  The best way to determine which option makes the most financial sense and matches your overall goals is to have a TOTAL COST ANALYSIS provided to you.  This analysis will break down the interest left to be paid on your current mortgage & compare the interest and costs of refinancing, along with strategies on how to best use/re-direct the savings.

Tom correct that a 15 Yr FHA refinance at your projected Loan-to-Value would not incur monthly MIP (mortgage insuance).

All conventional loans above would incur mortgage insurance (PMI). 

A VA refinance does not incur mortgage insurance.

Feel free to contact me with any questions.  

Best regards,
Steve

  • November 04 2010
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NO, there is none that I know of (I'd be interested to know WHO to all those who answered yes out there). HOWEVER, there are several lenders that can do lines of credits so if you qualify you can possibly refinance your first at 80% and subordinate the rest of the 5% with your line of credit.  If you need assistance with this, we would be more than happy to go over it with you.  
  • November 04 2010
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Profile picture for Tim T Wells
Hi Mortgagequestion,

You might consider getting a 15yr Fixed FHA loan, without mortgage insurance.

Good luck!
  • November 04 2010
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There are lenders currently financing first and seconds to 85%.  You need to check around to see about spliting your mortgage into two loans and from that point evaluating if it makes the morst financial sense for your goals.
Have an amazing day!!
  • November 03 2010
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Profile picture for hpvanc
You know this question is 2 months old.  I hope the OP has found the answer before now.
  • September 02 2010
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You know your best bet is to check with a direct lender to ask your question but, in my opinion, I think it's a tough sell.   Good luck - call BOA or Wells Fargo mortgage loan officer would be where I would start.
  • September 02 2010
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Hi,

Happy to talk to you about your scenario.
Depends also on your debt to income.

You may be able to do an 80%1st and a second.

Or you may qualify for a loan modification if your having a financial hardship.

JoAnna  Jensen
Legal Assistant
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Chris Jensen
Sr. Mortgage Lender
[contact info removed by moderator]
Pleasanton, CA 
  • September 01 2010
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Clay's guidance is good; another option would be to break the loan into 2 loans; an 80% First mortgage and a HELOC 2nd Mortgage for the difference. 

Not all lenders can offer a HELOC, but in your situation, it should allow for the lowest overall loan costs.

  • July 03 2010
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Using your figures the loan to value is 86.3%, after rolling in closing costs and prepaids you will probably be just under 90%. If you refinance to a conventional loan you should get 4.25%-4.375% on a 30 yr and the monthly mortgage insurance payment will be about the same as you pay now. If you pay the closing costs and prepaids at closing and lower the balance to 85%, then the monthly mortgage insurance payment will be lower than you pay now. Also, once you get to 78% on a conventional you can use a new appraisal to remove the MI which is different than the MI removal on FHA.  Another option is lender paid mortgage insurance which will bump the rate up to 4.5% up to 85% LTV or 4.625%-4.75% for 85.01-90% LTV and no monthly MI payment.  

  • July 03 2010
  • 2Yes

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