Refinancing usually makes sense when you are going to recoup the amount you pay in closing costs in the form of lower payments over how long you will have the loan for. If closing costs are $3k and you only plan on being in the loan for 6 months, then you would need to save $500/mo in order for you to break even. However there is another option that homeowners can potentially have, and that is called a "no cost" refinance, where the borrower accepts a higher interest rate in lieu of paying any closing costs (the higher rate generates a $ credit from the lender towards your costs is how it actually works). If your closing costs are $0 then you need to save $0 a month to break even - you won't get the lowest possible rate you could get, but being currently at 7.6% there should still be the potential to save. Usually the difference in rate is .25% to .50% higher.
Now in order to refinance your condo lenders will require it to be off the market, some just 1 day, some 3 months, some 6 months, it'll vary as each lender is free to create their own requirement. Usually not much more is needed than that, lenders used to require you sign something stating you have no intentions of putting it back on the market again but I haven't seen that in quite some time.
Since you have had it listed, a lender may choose not to pay your closing costs because by doing so they are looking for you to have the mortgage for a certain amount of time (6 months minimum but they are making their money in interest rather than the fees, so the longer you have the loan the happier they'll be) and I bring this up because if they know you are possibly going to re-list the property and pay their mortgage off after they give it to you, they won't be making that interest.
Also the fact that you've had your condo on the market for a couple years without it selling may be an issue to some lenders, as it doesn't seem like it's very marketable (or at least at the price it's listed at). Not all lenders will make a deal about it, but there is that potential.... more
In most cases where I have had an appraisal to come in lower than the accepted price on the purchase contract the seller has re-negotiated the price. At times, they will request a second appraisal just to be able to compare, however, they usually come in pretty close to whatever the 1st one came in at. You should notify both your real estate agent and your attorney and provide them both with a copy of your appraisal. Typically, your attorney will do the re-negotiations with the seller's attorney for you, however, there are times when the real estate agents are involved. You should never pay more than what a home is worth, especially in a declining market. The seller understands that this is not something you have control over and should be willing to negotiate, however, be ware, that if they come down on the price and they were contributing anything to closing costs, they will probably try to renegotiate that end of the bargain as well. Good luck. Hope that was helpful!
PanAmerican Mortgage, LLC
Senior Mortgage Consultant