Profile picture for StuckInFLForEver

Go for refinance or not at this time?

I am living in the house from more then 3 years. Want to stay another 2 to 3 years in the same house. Took 7/1 ARM @ 6%. Paid 20% already to avoid PMI 18 months back. Is this the time to refinance. The house already underwater and i don't want to pay the PMI again. Please advice me as i'm in FL. Current loan amount $255K and home value is around $230K.

  • April 28 2010 - US
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Answers (7)

Profile picture for StuckInFLForEver
I talked to my credit union and they said the loan is not sold to any one yet and no one is interested in buying the loan (Freddie or Fannie). If i want to refinance i have to put the 15% down to get the 5% equity in the home. I still have 3 1/2 years left in the 7/1 ARM and I am not sure by that time if the home value will come up or not. Any way i am one in the millions with under water home value and refinance issue. Thank you for all who answered/viewed by post.
  • July 02 2010
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Check and see if you are a Freddie or Fannie backed loan. Any broker in your area should be able to help you with that. If you are not, then you are probably best served to just hold tight to what you have. BUT if you are, you may be able to refinance with very few or no fees to a lower rate on a 30 yr fixed through the DU+ or HO Relief programs. This may be a great benefit as it may be tough to sell your home still in the next couple years.

Other resort is to contact your lender and see if they would lock you in to a lower fixed rate. Other then the value (which you couldnt have controled) it seems like you have put yourself it a pretty good spot and you are being proactive about what you do from here. Rates are still very low and if you can take advantage its a good time as long as it doesnt cost to much to do it. Hope that helps.
  • April 29 2010
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You would be required to pay Mortgage Insurance since your new LTV is over 80%. Since you plan on living there no more than three years I feel you would be best served staying with what you have. ..... Happy funding, Rudi
  • April 29 2010
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Profile picture for Liberty Mortgage
Since you want to stay in your home only another 2 - 3 years, it does not pay to refi-  The closing costs alone does not make it worthwhile-  If you planned on keeping this home as your primary for years to come, I would look into possibly Refinancing into a Du Refi Plus or Freddie Refi relief if you have one of those mortgages.
  • April 29 2010
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You've got another 4 years left on your 7/1 ARM. Find your NOTE and check your index and margin to see where the rate will go when the 7/1 starts to adjust.  Since you're underwater you may as well save the refinance fees. Call your lender and see if they can re-write your loan to a 30 year fixed rate, doubtful they will help, but you may as well ask.
When your loan adjusts, remember is will adjust to a 23 year amortization.  Check out the mortgage calculator at dinkytown.com to see what your loan amount will be at the adjustment and the rate at the adjustment. Good Luck. TZ
  • April 28 2010
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I would suggest you stick with what you have presently. It is not worth paying a bunch of up-front fees. The value may come back in the next few years at which time you can re-assess the situation. Best of luck. Regards, John
  • April 28 2010
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Profile picture for daveskow

 if you can refi  at a lower rate for  realtively low amount of fees  ...then maybe

if costs are  higher than what your payment savings  would be for  2 years...keep what you have

  • April 28 2010
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