Forgotten Your Password?

Need to Register?

Question Icon

Can someone please explain the process of dropping the pmi when changing from a fha loan to a conventional loan?

by jamesceline450 from Grand Rapids, Michigan. May 28th 2014 Reply


Dave Metsker (DaveMetsker)
#36 ranked lender in Oregon - 2,317 contributions

When you pay off an FHA loan, the mortgage insurance is cancelled, so you need not pay it any more. If your conventional loan is at 80% or less of the value of your home, you will have no PMI.

May 28th 2014
0
0
Michelle Curtis Loan Originator NMLS 401173 (EmbassyFundingLLC)
#1 ranked lender in Florida - 2,242 contributions

As long as your loan to value is 80% or less based on your appraisal when you refinance , no PMI will be required.

May 28th 2014
0
0
Pamela Gordon (pam@thegordongroupinc.com)
#64 ranked lender in Florida - 11 contributions

If you have at least 20% equity in the property, a new conventional loan will not have mortgage insurance. If you have 5% or greater equity you can use LPMI, which is Lender Paid Mortgage Insurance on a conventional loan that will increase your interest rate a bit but eliminate traditional PMI. Your payment will be lower and the additional interest you are paying is tax deductible so this is usually the best solution for someone with reasonable credit scores.

May 29th 2014
0
0
Subscribe to our news feed.