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lsuCJ5 
LSU Fan
Geismar, LA
Member since Nov 2012
104 posts
| Refinance to eliminate pmi? (Posted on 1/10/13 at 1:30 pm)
I currently have a 4.25% 30 year fixed mortgage. I owe about 89 % on the loan right now. Is there any suggestions and or options that I could do to refinance right now and be able to get rid of PMI? I currently think I am paying $145 a month just for the PMI.
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Bacchus 
New Orleans Saints Fan
Tulsa
Member since Feb 2009
173 posts
| re: Refinance to eliminate pmi? (Posted on 1/10/13 at 1:33 pm to lsuCJ5)
If you refinance, but only have 11% equity, can't you just take out a second mortgage for the other 9% and avoid paying PMI?
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Tenforty1728
LSU Fan
Baton Rouge
Member since Oct 2012
46 posts
| re: Refinance to eliminate pmi? (Posted on 1/10/13 at 1:42 pm to Bacchus)
Paying off mortgages early is always a contested topic on this board. I would suggest paying additional principal each month until you reach 20% equity if that's possible. You would avoid the refinancing costs. If you include PMI payments as interest and figure the interest rate you're borrowing at, paying this off early can save around 7%. That's a pretty solid return for your money.
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TheWiz
LSU Fan
NOLA
Member since Aug 2007
6528 posts
| re: Refinance to eliminate pmi? (Posted on 1/10/13 at 1:49 pm to lsuCJ5)
Under the new administration, PMI is now doubled. We refinanced 5% to 3.25%. We ultimately still saved about $150/month; which affords us enough to pay extra towards my wife MD student loans.
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lnomm34 
USA Fan
Mississippi
Member since Oct 2009
7429 posts
| re: Refinance to eliminate pmi? (Posted on 1/10/13 at 2:25 pm to TheWiz)
quote:
Under the new administration, PMI is now doubled
Say what??
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lsuCJ5
LSU Fan
Geismar, LA
Member since Nov 2012
104 posts
| re: Refinance to eliminate pmi? (Posted on 1/10/13 at 2:33 pm to Tenforty1728)
I do pay what i can extra per month, but i would still wish i could make this pmi go away.
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sstig
LSU Fan
Houston
Member since Oct 2003
1577 posts
| re: Refinance to eliminate pmi? (Posted on 1/10/13 at 9:05 pm to lsuCJ5)
Has the value of your home increased over the past few years? 20% of the appraised value is the number to focus on. How long since you purchased? May have had the market help you close the gap.
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foshizzle
LSU Fan
Member since Mar 2008
25123 posts
| re: Refinance to eliminate pmi? (Posted on 1/10/13 at 10:45 pm to Tenforty1728)
quote:
Paying off mortgages early is always a contested topic on this board.
If all else is equal, paying off early given today's rates is not a good idea b/c the ROI is so low.
But this could be different b/c not all else is equal. Run the numbers in a spreadsheet and see.
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LSUGUMBO
New Orleans Saints Fan
Shreveport, LA
Member since Sep 2005
3809 posts
| re: Refinance to eliminate pmi? (Posted on 1/11/13 at 6:44 am to lsuCJ5)
Ask your lender about prepaying PMI. I'm not sure of all the details, but it saved us a ton of money by bringing a little extra to closing. I think we paid $1000 up front to save paying $100/month for 2-3 yrs. I don't have the exact numbers but it was somewhere in that ballpark.
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lsuCJ5
LSU Fan
Geismar, LA
Member since Nov 2012
104 posts
| re: Refinance to eliminate pmi? (Posted on 1/11/13 at 7:52 am to sstig)
i bought 2 years ago and the value has probably stayed the same. i'll call my guy that i got the loan with to see what he suggest to do.
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AbsolutTiger
LSU Fan
Baton Rouge
Member since Sep 2006
4141 posts
| re: Refinance to eliminate pmi? (Posted on 1/12/13 at 11:37 pm to lsuCJ5)
PMI blows.
I know that's not helpful, just needed to say it.
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tirebiter
LSU Fan
ATL
Member since Oct 2006
4468 posts
| re: Refinance to eliminate pmi? (Posted on 1/14/13 at 5:57 pm to AbsolutTiger)
From a tax payer's perspective I say it doesn't blow. If people don't want to pay PMI then they should save up enough money to give lenders a reasonable margin of safety in the event of housing declines, ie 20% DP, on any given house. Shit, you're already getting subsidized cut-rate mortgages. Compare 7% rates to 3.5% on a $300k house. Compare that to 9%-12% back in the late 70's early 80's. Current mortgages are a great deal, PMI or not.
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