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Should I refinance with a conventional loan? I want to get out of FHA MPI a year after original purchase.

by elyse_n from Charleston, South Carolina. Feb 7th 2013 Reply


Steven Ceceri (CreativeFinancingOptionsGroup)
#36 ranked lender in Massachusetts - 723 contributions

You would want to compare the two programs as one would allow you to eliminate MI if you have 20% equity supported by an appraisal that would be ordered through the loan process. I just quoted on for a customer in Rhode Island and they are saving $100 per month using a Fannie Mae loan versus FHA. These were for 30 Year Fixed terms and even though the FHA Rates are lower by almost 1%, the mortgage insurance basically eliminated any savings. I'd be happy to assess your situation directly as a Direct Lender in all 50 States.

Feb 7th 2013
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Matt Pollina (matt@smartmtgs.net)
#57 ranked lender in Illinois - 40 contributions

If you have the equity, by all means you should refinance into a conventional mortgage.

Feb 7th 2013
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Carlo Sanchez (MortgageLendingPro)
#0 ranked lender in Utah - 1,163 contributions

Definitely compare the two but a lot will depend on your Fico scores and LTV.

Feb 7th 2013
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Todd Glassman (Todd Glassman)
#1 ranked lender in South Carolina - 120 contributions

It all depends on the the equity you have in your home and the credit score and debt to income ratio. If you have any further questions we are local in South Carolina.

Feb 7th 2013
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Randy Brown (rbrownmtg)
#30 ranked lender in South Carolina - 6 contributions

I fyou have an equity position in your home then it moght make sense to convert your existing FHA loan to a CONV loan to reduce (or eliminate) PMI. There are other consideration as well such as your credit history and the loan size. I'm here in South Carolina and would be happy to discuss your scenario in greater detail.

Feb 7th 2013
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John Schweer (johnschweer)
#9 ranked lender in Missouri - 163 contributions

To make a truly educated decison you need to concider the other factors, like how long you plan on staying in the new loan & owning the home, that combined with the current rate and mortgage insurance (conv or fha) a true mortgage professional will look at all these factors and educate you on the options available to you. If you click on my photo to the left it will give you my contact information and id be happy to have a conversation w/out pulling your credit etc.

Feb 7th 2013
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David Kosmecki (David_Kosmecki)
#37 ranked lender in Minnesota - 256 contributions

Moving to a conventonal loan is a good idea. The prerequisites include credit score, loan to value and haveing sufficient time in the current loan so a new appraisal can be used. If you are short of the needed 20% equity, consider a lender paid single preimium mortgage insurance product - no monthly mortgage insurance payment. Good luck.

Feb 7th 2013
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Barb Lanis (BarbLanis)
#70 ranked lender in Illinois - 663 contributions

Assuming you made the minimum down payment with your FHA loan of 3.5% - You would need to either have an appraised value, or pay down your existing mortgage, so that you have at least 5% equity to get a conventional loan. If you have the 5% equity, or will have, it's very likely that you will have a much lower payment. I am assuming that you took out an FHA loan for a specific reason like the lower down payment or perhaps a low credit score?

Feb 7th 2013
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Jason Vondrak (jvondrak)
#220 ranked lender in California - 1,741 contributions

Whether or not you should refinance into a conventional loan depends on the amount of equity you have built in your home - if you do have enough equity and a higher enough credit score to refinance into a conventional loan you will probably be able to get a much lower interest rate and not have to pay for mortgage insurance.

Feb 7th 2013
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Garett Hyman (GarettHyman)
#43 ranked lender in Michigan - 14 contributions

If you have at least 20% equity in your home in most cases it will make sense to go with a conventional loan. Click the links below to see an estimate of the value of your home. https://secure.53.com/mortgage/app/homevalue

Feb 7th 2013
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Joe Shamie (Joe Shamie)
#4 ranked lender in New Jersey - 1,412 contributions

If you are not under 80% you wont be able to eliminate the MI.

Feb 7th 2013
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