FHA Loan question on PMI reduction

Asked by anibee, East Brunswick, NJ Tue Jun 12, 2012

I bought a condo in East Brunswick and got it through FHA. I had gotten it when the Real Estate was in peak. I refinanced it through streamline FHA last year and now was trying to see if I can get the PMI removed by paying balance of 20% down. The loan servicer (BofA) said that it cannot be done and I have to pay for next 5 years (4 years now). My unit is down by 90K and cannot affort to refinance by getting a regular loan.

Please help.

Thanks

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3
Jim Simms, Mortgage Broker Or Lender, Louisville, KY
Wed Jun 13, 2012
I second John's answer.

Jim Simms
NMLS # 6395
JSimms@cmcloans.com
Financing Kentucky One Home at a Time
1 vote
Mickey Balla…, Mortgage Broker Or Lender, Parsippany, NJ
Wed Jun 13, 2012
Hi Anibee,

Yes FHA does require to you pay FHA MIP for a minimum of 5 years. But if you were planning to pay down the balance 20%, maybe you would be better off refinancing out of the Mortgage Insurance and out of FHA all together. If you would like to discuss options, please feel free to contact me, I would love to help.

Mickey Ballantine
REMN
Parsippany, NJ
973-532-8733
mballantine@remn.com

See my testimonials on my reference page for confidence!
0 votes
Mickey,

Thanks for your answer. As I mentioned, the property value has depreciated by 90K and if I try to refinance with appriasal, I will not have funds to pay for deficit and then make another 20%. Not sure if you can show me some light that I am not able to see.

Thank you,
Flag Wed Jun 13, 2012
Ron Thomas, Agent, Fresno, CA
Tue Jun 12, 2012
You should be looking at your Loan papers:
I have heard that one lender used the figure 20% when talking about eliminating the PMI;
I have also heard of 21% or 22%.
Not sure how they can leagally do that, but the Buyer signs the papers....

Good luck and may God bless
0 votes
Ron thanks, its 22% but even if I paid that, they said that as per loan agreement, I have to pay for the first 5 years. Then after that, I will have to pay till my outstanding loan is 78% of the loan.

Thank you
Flag Tue Jun 12, 2012
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