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Subject:  Re: FHA Streamline Refinance Date:  5/7/2013  4:53 PM
Author:  aj485 Number:  307002 of 312187

Currently, I've owned this home since 2003 with no plans to move in the near future. The appraisal price back then was $118K and after a decade of appreciation it is currently appraised for $119K. (Ain't real estate speculation grand?) The current mortgage balance is $95K with about 20 years to go on the mortgage, fixed rate of 5.5%

With a $95k balance and a valuation of $119k, you are at 79.8% LTV (loan to value). At this point, you should probably be looking to refinance into a conventional loan, rather than an FHA loan, streamline or not.

With a conventional mortgage, lenders are required to remove PMI (Private Mortgage Insurance) when your loan gets to a principal that is 78% or less of the original valuation. With FHA MIP (Mortgage Insurance Premium), the MIP can be required to remain for a minimum of 5 years (and soon to be the full term of the mortgage), even if the LTV is signficantly lower than 78%.

At a fixed rate of 5.5%, if your credit is decent, I would definitely suggest looking at refinancing, but not necessarily with Wells Fargo, unless they are willing to quote you a conventional mortgage in addition to an FHA mortgage, and they are competitive on the rate and fees to close.

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