Luaderdale SS Posted January 27, 2007 Author Report Share Posted January 27, 2007 I"m taking it you're on a variable rate loan currently? Why not just refinance to a fixed rate mortgage? Sounds easy enough to me...... You must not have read the posts I made, I have a FIXED RATE loan 6% I was asking about PMI refund, and bitching about the price of insurance and taxes Quote Link to comment Share on other sites More sharing options...
DeeHutch Posted January 27, 2007 Report Share Posted January 27, 2007 Yeah, I didn't read through word for word. I scanned through looking for "fixed" and "variable" but must have scanned too fast. Hope it works out for you man....... Quote Link to comment Share on other sites More sharing options...
Black2003SS Posted January 27, 2007 Report Share Posted January 27, 2007 Some things about PMI. PMI is good, PMI is bad, it really depends on the situation. For example, PMI is not really that good for the person with 800 credit scores when they would clearly qualify for an 80/20 loan. Its a waste of money in most cases. However, PMI is good as well...how? Well see, many years ago, when PMI didn't exist, majority of the time you had to put at least 10-20% down, not the easiest feat for younger first time home buyers, like married and right out of college with entry level salaries and maybe 640 credit scores. With 640 scores, you probably wouldnt qualify for a good 80/20 (read good, like very low interest rates etc.). Now enters PMI...the 640 score candidate can now do 100% financing and pay PMI to get the loan. PMI is required for any fannae mae/freddie mac secured loans over 80% LTV (loan to value). PMI is private mortgage insurance that protects the lender for any amount over 80% against loss. So if you default on your loan, the loan would be covered up to 80% (hence the old 20% down mantra), but anything over and above that, the lender had to eat...ouch. PMI covers that amount the lender used to have to eat, allowing the creation of many many new programs like interest only, negative amortization loans, reverse mortgages, 100% financing, etc. Now, specifically about PMI refunds, I was not aware of any refunds for PMI. PMI is now tax deductible this year for ONLY CERTAIN INCOME brackets. If you make over $100,000 combined household income, forget it. Our PMI is only required until the loan amount reaches 75% of the value and then all you do is pay $300 for an appraisal to verify this and...boom...no more PMI. So, I would contact Wells Fargo and ask them if they ordered an independent appraisal and the value came in good, that they would remove the PMI. Oh...and dont let them talk you into refinancing to do it. Wells is notorious for that. If you have 11 months left, it might be worth your while, especially if you are paying $90-100 a month. I'm almost out of time here this morning, so I will answer the pros and cons of 80/20 versus 100% financing later today! Quote Link to comment Share on other sites More sharing options...
Luaderdale SS Posted January 27, 2007 Author Report Share Posted January 27, 2007 (edited) Now, specifically about PMI refunds, I was not aware of any refunds for PMI. PMI is now tax deductible this year for ONLY CERTAIN INCOME brackets. If you make over $100,000 combined household income, forget it. Our PMI is only required until the loan amount reaches 75% of the value and then all you do is pay $300 for an appraisal to verify this and...boom...no more PMI. So, I would contact Wells Fargo and ask them if they ordered an independent appraisal and the value came in good, that they would remove the PMI. Oh...and dont let them talk you into refinancing to do it. Wells is notorious for that. If you have 11 months left, it might be worth your while, especially if you are paying $90-100 a month. Check the link, and if anyone gets any money back from this remember my cut http://www.hud.gov/offices/hsg/comp/refunds/ my loan is at about 50% LTV, I only had a 760 credit score when I got the loan so I guess thats why I am paying PMI. My income (live alone) is under 100k. Wells Fargo says I cant drop it until the five years mark. oops, forgot to say its an FHA loan Edited January 27, 2007 by Luaderdale SS (see edit history) Quote Link to comment Share on other sites More sharing options...
Black2003SS Posted January 27, 2007 Report Share Posted January 27, 2007 Ah, thats different. FHA, I missed that part when you said that. Everything works different with FHA. Looks like you will get a refund anyways. We don't do FHA loans anymore and we certainly don't do VA loans (this is another whole can of worms). Personally, I feel alot of companies take severe advantage of vets with VA loans and 95% of the time, VA loans are not the better deal in most cases. The system needs to be revamped for VA loans. Alot of vets get lured into them because of an attractive interest rate (which usually isnt much better than market anyways) and no PMI no matter what. Well, the funding fee is so rediculous plus any origination fees and loan discount fees, its just not worth it. Also, the VA loans usually roll in the funding fee, closing costs, and other fees. Then you are paying interest on these costs, so it really is just like paying PMI anyways. You woud be better off with a conventional loan and asking for sellers concessions (let the seller of the home pay for your closing costs). The ONLY reputable VA lender I have come accross is the Navy Federal Credit Union (they do right by their clients everytime that I have seen). P.S. 760 credit score is a very good score and you do have the lowest PMI. Just to clarify, even if you had 800 scores, you still would have had to pay PMI with the FHA loan. Quote Link to comment Share on other sites More sharing options...
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