Steve Boucher's Advice

I would agree with all answers so far.  Only way to get out of it is if the automated underwriting system allows for it.  It would also be lender specific so if you do want to avoid it you could shop a few lenders.  I would also ask if the lender would pay for it and see if they are able to offer that

With rates that high it would absolutely be worth looking intoI can not think of any cons to refinancing into a lower rate/payment unless you are payng closing costs and plan on selling your house in the next year or so.  In that case you would need to calculate the savings vs cost to refi and figure out how long it takes to recoup those costs.  You wouldn't refi if it didnt add upOf course the big challenge in refinancing these days is the value of your home vs the balance on the 2 loans.

you should be able to obtain the best rates available when using an FHA loan unless your credit score is below 640 and some lenders have a hit to the rate

If you have less then 20% down then you will have to pay mortgage insurance in some form.  You may have the option of lender paid mortgage insurance. With this product you have a slightly higher rate but no monthly MI payment.  Since you have 10% down I do know of one bank that is currently still doing 80-10 loans.  Please contact me if interested