Close

See current mortgage rates on Zillow Mortgage Marketplace

Profile picture for jjoeph

fha to convetional loan with money down to 80% LTV

Hi I am refinancing my existing 15yr fha loan(14 years remaining) to conventional 15 yr. I am bringing in money to make loan value to 80% inorder to get out of pmi. since we are closing om febFebruary3rd fha charges full month interest and my new loan will also have interest for the month of February. When i discussed this with the loan officer he said you will not have any interest for the month of february on the second loan. Can any one help me to understand what he mentioning about. I feel there should be a catch since bank wants there interest somehow
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
January 29 2013 - Southeast Dallas
We think we've answered this question for you!
  • Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.
 
 

Answers (7)

jjoeph- Yes better to do this at the end of the month and incur interest during February only on your current loan.


Tom- If done at the beginning of the month the FHA will receive the interest in the payoff and the new Conventional will incur it in the form or prepaid interest.  Would be kinda silly.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
January 29 2013
Profile picture for jjoeph
OLD INTEREST IS ONLY 3.25 AND NEW 2.875. SO NO MUCH DIFFERENCE IN INTEREST PAYMENT OLD VS NEW LOAN. DOES THE SECOND LOAN HS A O INTERST FOR THE FIRST MONTH. NO INTERST IN THE TRUE SENCE, DOENT FALL ON THE NEXT MONTH.DOES ANY BANK DO THAT. I THINK IT IS BETER TO CLOSE ON TOWRDS THE END OF FEB?
 
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
January 29 2013
If you delay closing, Nic...... Will interest on the old not be higher? And interest on the new note the same?


Is that accurate?

  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
January 29 2013
It was prompt but not accurate jjoeph.   

FHA loans have a unique aspect to them that conventional do not, regardless of whether you close on the 1st or the 31st you pay the full month.  So it makes no sense at all to continue as you are being directed to, tell your LO that you want your lock exented and schedule your closing for February 22nd.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
January 29 2013
If your loan funds on Feb 3 then you will pay interest for Jan & Feb in the payoff, plus Feb MI, plus prepaid interest for Feb to the new lender if you do not do a short pay.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
January 29 2013
Profile picture for jjoeph
Thank you Kathy for the promt and accurate answer.
We are clossing on 30th of January and my fha(current) loan will be funded on third. Since it is FHA my payoff quote included february interest and pmi. But does any bank willing to absorb my February interest since it is alredy a zero clossing cost loan (no zero out of pocket). I greatly appreciate your reply 
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
January 29 2013
When you have a mortgage you pay your interest 'in arrears'.  So if you make a payment on February 1st, you are paying the interest for the month of January.  Alternately, your lender could possibly do one of two things for your new mortgage: Close on the 3rd and defer the interest that is normally charged (27 days of interest, which would make your first payment due March 1st); or close on the 3rd and pay the 27 days of accrued  interest and have your first payment April 1st. Just remember, you always pay the interest for the previous 30 days on your mortgage.  Opposite of rent where you pay and then stay.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
January 29 2013
 
Related Questions
fha to convetional loan with money down to 80% LTV
Profile picture for Nic Netherton
Latest answer by Nic Netherton
January 29 2013 | 7 answers
Mortgage Rates
 
Be A Good Neighbor

Zillow Advice depends on each member to keep it a safe, fun, and positive place. If you see abuse, flag it. More on our Good Neighbor Policy.

Homes for Sale
  1. 532 Lookout Mountain Trl, Mesquite, TX Home For Sale
    532 Lookout Mountain Trl, Mesquite, TX 75149

     For Sale: $115,000

    • Beds: 4
    • Sqft: 1730
    • Baths: 2.5
    • Lot: 4416
  2. 1 Pin Oak St, Seagoville, TX Home For Sale
    1 Pin Oak St, Seagoville, TX 75159

     For Sale: $4,500

    • Beds: 0
    • Sqft: --
    • Baths: --
    • Lot: 13599
  3. 3911 Spring Ave, Dallas, TX Home For Sale
    3911 Spring Ave, Dallas, TX 75210

     For Sale: $3,429

    • Beds: 0
    • Sqft: 836
    • Baths: --
    • Lot: 5227