refi out of PMI

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I bought a house 2 years ago at 4.5% with PMI. I am looking to refi to get rid of PMI and lower the rate a little bit.  I spoke to a lender who can do 4.125%, 30 year with zero closing costs. I know 3.5 is out there on a 30 year but the closing costs seem high. The monthly savings VS the lump sum out of pocket doesn't seem beneficial.  Anybody use any no or low closing costs refi lenders?

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Try Penfed or local credit union. You can also check boxhomeloans. There are many options.
Are you sure you are below the 80% LTV to get rid of PMI?

The lender I spoke to ran a report and they were confident I would be. It is a town house and two of the same exact units just sold at prices that would put me right around 78%. My unit also has a better view since there is no building in front of mine which I was told would help give me a little more cushion.

I don't know where you're located, but I used a company called Capcenter in VA and got 3.75 on a 30 year fixed, no closing costs.  The rate has since dropped to 3.625.  I don't know what their service area is, but I'm sure there are other similar lenders out there.  They basically close the loan & sell it off to someone else to service (Pennymac in my case).  I've used them twice & had a great experience both times.

https://www.capcenter.com/

You can roll the closing costs into the loan and still have a lower monthly payment than the 4.125% loan. PenFed has 3.25% 30 year rate now, so you'd save almost a full percent.

On a $200k loan with 2% closing costs, the lower rate would be $888 a month vs. $969 for the no closing cost loan, and total payments would be $320k vs $350k.

mistadeal said:   You can roll the closing costs into the loan and still have a lower monthly payment than the 4.125% loan. PenFed has 3.25% 30 year rate now, so you'd save almost a full percent.

On a $200k loan with 2% closing costs, the lower rate would be $888 a month vs. $969 for the no closing cost loan, and total payments would be $320k vs $350k.

  
I was going to consider that. Only problem would be if I am close to the cutoff line of 80% L:TV

I had a similar thing on a ~250k house - 4.5%, 2 years in, house values have gone up...

I got a 3.625% no-cost refi with my current lender, Aimloan. Actually ended up with some cash back after it was all said and done. Looks like rates have gone down a tiny bit since then...you should still be able to get that, or 3.5% w/<1k in closing costs.

I got some Zillow quotes and ended up getting Aimloan to match something better than was publicly available.

FLpNc said:   
mistadeal said:   You can roll the closing costs into the loan and still have a lower monthly payment than the 4.125% loan. PenFed has 3.25% 30 year rate now, so you'd save almost a full percent.

On a $200k loan with 2% closing costs, the lower rate would be $888 a month vs. $969 for the no closing cost loan, and total payments would be $320k vs $350k.

  
I was going to consider that. Only problem would be if I am close to the cutoff line of 80% L:TV

  Dunno your state, I see ~3.50-3.625% no cost at Box (FWF sponsor link for -1/8 point)  for around that loan size.  When looking at their rate table and comparing, realize they put an estimate for all third party fees and some of the other quotes may not.
Penfed is decidedly a harder sell when comparing with 3.5/3.625% no cost (in reality slightly negative cost, if you're under 2 years their estimate will be high so title will cost less.  Plus you can as always negotiate with the title co for ~$200 or so if you want to -- I did twice. To do so you would just want to request the title co they want to use, then email that company and negotiate, before you get far into the process of course).  Penfed is more than 2% up front charge to get their headline quoted rates.  They have a 1% origination fee on the 3.25% example.  And, closing costs probably vary, but the one I was comparing was at negative 2 points, so that makes 3% total paid up front for "3.25% rate/3.4% APR" compared to "3.5% rate/< 3.5%APR*".  There's pros and cons with going no cost or buying down the rate.

*APR is also not calculated the same at each lender.  Some include third party fee estimates in the APR while others do not.

Also looks like you can get a little bit of a better rate if you are at 75% LTV at Box.

FLpNc said:   Also looks like you can get a little bit of a better rate if you are at 75% LTV at Box.
  I think that should be standard with all conforming loans at different lenders.  There are some standard pricing adjustments/markups (like for 75% vs 80 LTV) and the 1/4 point charge for waiving escrow.

Yeah that is what I am seeing for the most part.

4.125 puts me at $756/month to refi $156k with zero out of pocket

The 3.75 option at Box would put me at $723/month with about $900 out of pocket for transfer taxes.

Looks like it would take me 27 months to recoup the closing costs. I know the total outlay would be more, but I don't plan to be in the house for the next 30 years.

What state? What size loan?

Aimloan's providing live rates that you can lock in for 3.5% with <$1000 closing costs (with more than the usual fees guaranteed)...and I'm betting you can get 3.625 no closing cost if you contact them directly...

Florida. I currently owe about $156k

I always use a mortgage broker. I was just quoted 30 yr 3.5% having to pay appraisal $475 and title fees $1300. I'm in CA.

Check the huge mortgage thread - I asked in there and found a great nearby broker who was easy to work with and had the best rate at the time.  Outside of that, American Interbanc and Provident are options I'd check as well.  And if available in your state use EntitleDirect for title insurance/closing.

If you have your closing costs paid for, you're taking a higher rate with negative points that cover the closing costs.



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