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I have been in my home since 2011 I have an FHA loan and want to refinance. My 5% 1st and 8% on a second. FHA or conventional?

by lynnette.calvin413 from Oakland, California. Oct 26th 2015 Reply


Marty Stern (rubicon1020)
#434 ranked lender in California - 74 contributions

If you have a credit score of 680 or higher, and your loans total 80% or less of your home's value, you should definitely go conventional - rates are still low, and you'll lose the MI. If you stick with FHA you've got MI again (and for 30 more years!)Marty SternHomeStreet Bankmarty.stern@homestreet.com

Oct 26th 2015
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If you have a 640 Fico and equity above 20% you will be saving money in elimating your private mortgage insurance. Doing that will help you save money long term. Let me know if you have additional questions " Diego.perez@ogimb.com

Oct 27th 2015
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Crestico Funding (CresticoFunding)
#312 ranked lender in California - 337 contributions

Lynnette,Conventional should be your first choice unless because of specific reason you can't get a Conventional Loan. try to get a Borrower Paid Mortgage Insurance package, you may have a slightly higher payment for a year or two but once you remove your PMI, you no longer have to worry about refinancing. feel free to call our office at 310-348-7878 Opt. 3 to talk to one our Sr. Mortgage Advisors about your situation.

Oct 27th 2015
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Ralph Richard Guertin (ralph@absolutelowrates.com)
#136 ranked lender in Florida - 796 contributions

Hi, we need more information, what would be the payoff amounts on both loans and ballpark value, which you can get from Zillow.

Oct 27th 2015
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Sean Young (SeanYoung)
#2 ranked lender in Colorado - 1,112 contributions

It will depend on your loan balance, how much your property is worth, your credit score, your credit history, your debt to income ratio, your employment history etc. I would suggest speaking with a local loan officer or two and see what they can offer you and for to look at both options for an FHA and for conventional.

Oct 27th 2015
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Derick Condron (rightstartoregon)
#32 ranked lender in Oregon - 598 contributions

Sounds like you need to sit down with a local lender and discuss your options. Credit, income, loan to value will all be factors in what you can or cant do.

Oct 27th 2015
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William J Acres (William_Acres)
#73 ranked lender in Arizona - 8,726 contributions

If you credit scores are good, and your home has increased in value since you have owned it and you have at least 20% equity, then that would be the ideal scenario.. You can still refinance regardless (assuming you meet all other eligibility requirements), but the best scenario would be to combine both loans into one new conventional loan with no monthly mortgage insurance. The best advice I can give you is to contact a LOCAL mortgage broker and apply with them. Once they see your complete loan profile, they will be better equipped to advise you properly. Also, by applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with many lenders with each one offering a different type of lending program. This is unlike the local bank which typically only has a few lending programs. The more lenders, the more lending options, and the more likely your scenario will be accepted.. Plus, the broker is experienced in seeking out the best loan terms for your particular scenario, and he has lower overhead which typically results in lower rates and fees than most of the larger lenders.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com NMLS# 226347

Oct 27th 2015
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Phil Dumouchel (PhilDu)
#32 ranked lender in South Carolina - 2,240 contributions

As you see from the variety of answers - it depends. How much do you need to borrow vs. the current appraised value of the home? I often find that conventional makes more sense than FHA if you'll have at least 5-10% equity and even if you don't have strong credit. Often the payment would be the same or lower for conventional and WITHOUT the virtually permanent FHA PMI cost for many borrowers.

Oct 27th 2015
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