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FHA MIP Reduction Date

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Just came across this thread and need help decoding. I am familiar with PMI, as I have had it before, but I'm afraid I don't know what this news means. Could someone break it down please?

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Pmi is a percentage charged on loan balance over the year

it was 1.35% so on 100k loan you pay 1350 a year towards insurance guaranteeing the lenders money

now it is .85% so you will only be paying 850 a year for every 100k you borrow - the payment is divided into the 12 months and added to your monthly bill

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I got my lender to file the cancellation after I pressured them, they haven't been very helpful after this, im already giving up a better rate from other lenders because of my loyalty to them and of course they werent willing to cancel the old pmi initially so after this bs I'm ready to jump to another lender if they keep being like this.

 

My question is, IF they cancelled the old fha case number, how much of a challenge would be for me to switch to another lender?

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I should add that they mentioned that they don't think the new numbers will be assigned until after Monday, so I'm guessing they already cancelled the old case number.

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They cannot get the new numbers until Monday that is when the new PMI starts

as far as changing lenders that is your choice and even if they didnt want to help out with the case number cancelation so a new lender could do their job the fha connection portal allows the new bank to petition fha for help - which they do every time - knowing this most banks will simply release the number

B

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Thanks Brian so in the case that I decide to switch better stop them before they request a new case number? Also there were a couple of issues from the FHA appraisal, i asked the loan officer how to approach the issue, she said underwriting will tell us, been 4 days and it's still on their queue nobody has looked at it, is this normal or am I being to impatient? Thanks!

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if they were just going to ask a question of the UW then yes 4 days is too long - if they are waiting for a formal underwrite maybe not?

 

What was the issue? If you are going to change you may want to do it and inform them before they pull the new number -

Be upfront and direct - they will try to talk you out of it because they wont want to lose your business -

B

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Well, i think my file already went to the underwriter 2-3 weeks ago (been doing this process since the beginning of the year), unless everything goes to them after the appraisal; appraisal findings came on Friday, found a couple of small issues that need to be resolved (paint chipping related), loan officer said the underwriter will tell us what can be done (fix or escrow).

 

So it seems that the loan officer is mad that she has to do the extra work, hasn't been as nice or helpful after I forced them to submit the pmi cancellation (which they didn't want to do initially), so i emailed loan officer some questions about the timeline and the response was along the lines of "do u think im witholding information from u? when i get any news i will let u know", basically she's telling me to stop asking and sit like a puppy until she says jump, so now I can't even plan, of course I wrote back and this time didn't ask but demanded an estimated timeline and if we might need to reschedule the closing, sent it during lunch time, haven't heard back yet.

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So it seems that the loan officer is mad that she has to do the extra work, hasn't been as nice or helpful after I forced them to submit the pmi cancellation (which they didn't want to do initially), so i emailed loan officer some questions about the timeline and the response was along the lines of "do u think im witholding information from u? when i get any news i will let u know",

What extra work - this is her job - it is what she gets paid to do - wow

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Things point to that or maybe she's going thru some personal issues, she did my previous mortgage and I was raving about her, very, very surprised at her attitude now. I would hate to start from scratch again even though I might save .25 of a point but I would have to tell the seller about extending the change of lenders and extend the closing, seller would not be very happy.

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As nice as you can explain your frustration and try to make peace with her about everything - you are right, this far into the process starting over is difficult - thats no excuse to let them lower the bar - they need to do their job and most of all it sounds like they need to learn to communicate - 4 days with no decision is one thing that long with no response isnt -

 

Hang in there

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I have a question about the PMI rate drop, and would like any recommendations...please :)

 

We purchased a home in November of 2013 (FHA with 4.25% interest). We now have our current lender and previous lender (the loan was sold right after closing) calling us to get us to refinance. They said they can get us a new interest rate of 3.5% and reduce the PMI rate. They also said it would not add on to the life of the loan and they would cover closing costs. This would save us somewhere around $150 - $200 per month. Is this typical? I'm not sure if it is worth it, I guess I'm just confused as to if this would be a good idea or not. If we did this refi, would we have PMI for a longer term? We had originally planned to wait until our house was paid down enough to remove PMI and refi as conventional. Thanks for the help!

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Be careful of the small talk that is used to get you in the door - they will cover what costs - their fee? The appraisal? The title? If they will cover everything and you have no out of pocket expense why not save 1500-2000 a year for the life of the loan?

Just make sure you get with someone that isnt a shady sales person - and gives you the facts to consider

 

Good Luck

B

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Thank you for the quick response. That's what we're afraid of a "too good to be true" scam. The lenders that called us are Freedom Mortgage and PrimeSource Mortgage, I'm not sure about their integrity of their sales people. The guy we originally used is no longer with the company.

Edited by Working_On_It

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Thank you for the quick response. That's what we're afraid of a "too good to be true" scam. The lenders that called us are Freedom Mortgage and PrimeSource Mortgage, I'm not sure about their integrity of their sales people. The guy we originally used is no longer with the company.

It is definitely a great time to look into it - you can cut the rate and PMI by well over 1% but it is never truly free and anyone that says it is is just shifting the cost somehow - one way or another you are paying - but it doesnt mean you cant come out of it smelling like roses when done

B

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Is refinancing this early in the loan viewed badly? The sales rep from Freedom Mortgage did say that we would have to pay around $1100 for the escrow. I would absolutely love to save the money each month, but we were such nervous wrecks getting the loan in the first place, changing it just scares the bejeezus out of me!

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A lot of people are taking advantage of the new lower PMI and rates it is fine to refi - worst case it doesnt work out and you still have the current loan -

 

Find someone that will walk you through it and it should take a lot of the stress out of the process

 

Good Luck

B

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Well the saga with the lender continues, it seems that we won't make the closing, this is after i was after them to get going and they told me to settle down when things are ready they will let me know, i did waste 3 days bc i couldnt find a contractor for an estimate but it was mainly them, now I have to pay to keep my rate (I see the market gas gone up .25).

 

Is it usual for a bank to pay/partially pay this fee under these circumstances?

 

Let's say I get the clear to close today what would be the soonest that I can expect them to do a closing? I already rented my current house and the people moving in 3/1!

 

Thanks!

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