Should I refine my condo with low interest rate but higher pmi?

Under the new HARP 2.0 rules you may be able to refinance and keep your PMi the same. The numbers you have been quoted do not reflect that. You should talk to someone who knows an understands the program. I can be reached at 866-385-1650

You answered your own question. If you do refinance today, you will have that rate for the life of the loan. Although your monthly PMI will increase just remember that it is temporary. At the end of the day if you did nothing, you would still have the same payment. Why not refinance and continue to make today's payment to accelerate to true long-term savings?

Your loan scenario is basically a wash as it pertains to your monthly mortgage plus MI payment after all is said and done. You will be saving some money up front each month for a few years, but you will pay it back with the higher MI for a few years after that. The bigger question is how long do you intend on staying in your house. You haven't given the purchase date of your home, so I can't do a break even analysis for you. If you plan on keeping the house for a few years, I would probably keep your exisiting loan in place. If this is the home you will live in for many years, then a break even analysis will tell you to the day in time, when it becomes economically a better choice to do a new loan under the scenario you have provided. We can be reached at www.greaterbaymortgage.com or call us at 1800-890-500

Your numbers are a bit confusing... and it would really help if I knew which type of loan you have now.. FHA/VA/USDA or Conventional. If your current loan is FHA, then beginning June, there is a lower MIP factor that takes effect for borrowers whose loan was initiated prior to May 2009... If it's conventional and your loan is owned by Freddie / Fannie, you could refinance under HARP 2.0 and the MIP would not change... You could also do "Lender Paid" MIP, which would give you a slightly higher interest rate, but no mortgage insurance at all... but assuming your loan officer has done his due diligence, I can only assume that he has guided you to the best loan product for your particular scenario. If you're not sure, you can always contact a local mortgage broker, not a bank, and have them review your loan quote... if there is a better product out there for you, they will find it... WilliamAcres.com

I don't see real estate values increasing over the next several years. As home values decrease, people may want to take advantage of purchasing a single family home, and be free from paying condo association fees. This will have an adverse affect on the future values of condos. I think it comes down to how much you like where you are living at. I would compare what your current PITI and MI is versus renting a similar unit in your complex, as an added measure in determining if you should refinance now. I think in this marketplace, a borrower should learn as much about their neighborhood values as possible, including ownership versus renting. Obviously, your home has lost value since your original purchase in 2009. The real estate market is definitely still adjusting. Therefore, if you are hoping for a rebound in real estate values, I would not count on it for at least the next several years, particularly the condo market for the reasons I have stated.

This would very well depend on the type of loan you're currently in. If you're with Fannie Mae or Freddie Mac, your MI will not need to change under the HARP program. Also an option is to go through a Lender Paid refinance. This will offset having to pay mortgage insurance, for a bit higher of a rate. PMI has rised through FHA loans and is expected to rise again April first. If you are currently with the FHA, I'd ask about a FHA streamlined refinance. FHA streamlined refinances will require a 5% net tangible benefit, but will not require any appraisal, which will help especially if your value has depreciated over the years. FHA rates are lower than that of conventional rates. PMI can be removed once you reach 78% loan to value, or after a 5-year span which ever comes first. The long-term investment is very well worth it if you plan to live in your home for a long time, because after your PMI has dropped you'll be seeing the full benefits of the refinance.Feel free to e-mail me or give me a call, if you ever need any assistance!(858)-605-0481cburke@prospectfgi.com

I would tend to agree with James, that by refinancing now and getting the best possible rate which will save you over $110 a month net, is probably one of the better options. However, it may be worth it to see what would happen with single payment PMI. This is where you pay a lump sum for PMI either in cash at close or added to loan balance. You would still get the better rate and not have a monthly PMI payment. You would probable see a much bigger monthly savings this way. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com