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Do all banks charge mortgage insurance for refinances?

  • May 23 2011 - Santa Clara
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Answers (9)

In order to give you a professional opinion we would all need a little more information. How much is your home worth? How much do you owe? What is your credit score. There are companies who will give you a little higher rate but pay for the mortgage insurance. It sounds like you have a big enough loan amount where if you can get a 5% and have the lender pay for the MI it will drop your payment enough to refinance.
  • May 26 2011
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There is probably little reason to refinance.  The other thing you have to look at is how fast you are reducing your mortgage balance.  Loans are front loaded with interest, and when you get a new 30-year loan, your first payments won't reduce your mortgage balance very quickly.  If you have had your loan for a while, you are knocking your mortgage balance down each payment at a faster rate than you will if you refinance.

I would ask your current mortgage company for an amortization schedule or just look at your last statement to see how much you are paying off each week so you can make an informed decision.  The mortgage company you are attempting to refinance with should also be able to give you an amortization schedule to compare it too.

Good Luck 

  • May 24 2011
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Profile picture for catb12345
Having an existing loan at an interest rate of 5.67% and our monthly payment is $3,067 without mortgage insurance.  Why would we accept a new loan with an amount that increased from charges, and have it for 30 more years with an interest rate of 4.75 and then have to pay mortgage insurance with a payment of 2,929.  If are only intention was to lower our monthly payment.  This doesn't seem like it is worth it in the long run.  Who can tell me if this sounds right to you?  Thanks
  • May 24 2011
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Profile picture for Chris Corica
Most but NOT all.
  • May 24 2011
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Conventional loans over 80% will always have mortgage insurance.  All FHA loans will have mortgage insurance regardless of the LTV.

Mortgage insurance is not bad though, up until recently you couldn't even get mortgage insurance.
  • May 24 2011
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Hi Catb12345,

If you are above 80% LTV you will have MI, either lender paid or borrower paid. 
  • May 23 2011
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Yes and No.  There is lender paid and borrower paid MI.  Or if you are less than 80% ltv no MI is needed.
  • May 23 2011
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CatB: It is normal for transactions with less than 20% of equity  but you can "buy Out' the mortgage insurance depending on what kind of transaction you have. Are you refinancing FHA or Conventinal? Marc

  • May 23 2011
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Mortgage insurance is typically required on Purchase or Refinance transaction when the loan to value is greater than 80%.
  • May 23 2011
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