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Is it possible to refinance without PMI and LTV>80%

I am looking to refinance our home which is currently on a 30-FHA mortgage.  Our current LTV is about 87%.  I want to refinance to take advantage of a lower rate.  I also want to drop our current PMI if possible.  Is this possible or am I stuck with PMI until I can get the LTV below 80%? 

I have excellent credit, little debt, and high income.  I could wait a year and save the cash needed to pay the loan down to 80% LTV, but I would rather take advantage of the interest rates now than risk them rising even further over the next year.  Any suggestions on whether this can be done is greatly appreciated.
  • August 08 2013 - Lansing Township
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Answers (6)

You have a few options available to get a better mortgage with options for eliminating monthly PMI. You can do Lender paid PMI, single pay PMI (non-refundable(best option)), or an 80/10 1st and 2nd mortgage.

Give me a call and I can help go over this information with you.

Thanks.


Best of Luck!
  • August 08 2013
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I recommend that you consider refinancing into a new first mortgage at 80% of the property value and adding a 2nd mortgage equal to the balance of your outstanding mortgage debt.  This will likely afford you the lowest overall monthly payment and the lowest effective interest rate.  
  • August 08 2013
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On a conventional loan, you would need to get PMI but once you have a total of 80% equity in your home you have the option to remove it and/or once it hits 78% it will automatically drop off versus a FHA loan which is required to be on there for the lifetime of the loan. in addition your PMI quote may be less than what you are paying now so it may not be as much of an addition as it is now.


Please let me know if I can be of any other assistance and good luck!
  • August 08 2013
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There are a few different ways to refinance into conventional without paying monthly mortgage insurance:

1)  Have lender price out Lender Paid Mortgage Insurance.  There is an add on to rate, but you can take advantage of low rate environment.
2)  Open up a second loan to 90%.  YOu would have 2 loans, but you can aggressively pay down the second so you are only left with one fixed rate loan. 

  • August 08 2013
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You can't get out of pmi, but with a conventional refi, you can opt for either lender paid, or single premium. With single premium, you may be able to roll it into the loan, which would raise your payment only slightly. Let me know if I can help.

Mark G.
  • August 08 2013
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try a " combination loan "new first mtg for 80% of value and then a smaller  2nd mortgage ( often a heloc or home equity line of credit ) for the remainder
  • August 08 2013
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