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But she crunched the numbers based on's numbers, and yes, with a current mortgage balance of $95K, I'm below the 78% threshold to jettison mortgage insurance--barely.

You're still not getting it.

When refinancing into a new conventional mortgage, the maximum LTV allowed to not get PMI is 80%, not 78%. The 78% figure is for a mortgage that was issued with PMI, and you are trying to drop PMI from the loan.

If the loan officer you talked to specifically said 78% was the threshold on a new conventional mortgage, you need to get a different lender, because she apparently doesn't know the rules she should. If she just talked about the threshold to not have PMI, and you assumed it was 78%, you need to read the paragraph above enough times so that you understand what the requirements are for the different circumstances - getting a new loan vs. dropping PMI from a loan that was issued with PMI.

So with that, she quoted me an interest rate of 3% on a 15-year fixed loan.

Another reason you need to look for another lender is, unless your credit is bad, the rates you are being quoted aren't competitive. The first 3 lenders I checked are offering 15 year rates well below 3%

PenFed is offering 2.625% with no points:

AIM Loan is offering 2.5% with no points:

Amerisave is offering 2.25%, but I didn't look to see if they were charging points:

She also said, as others did here on this board, that if the appraisal came in such that I was just barely over that 78% threshold that I could put the little bit on a credit card or somesuch and pay it off with that forty bucks a month savings.

Yes, that is possible, but you would need to run the numbers to see if it was worth it to pay credit card interest for however long it would take you to pay it off at $40/month, or if paying a small amount of PMI until you get down below the 78% threshold (because this would be a mortgage that was issued with PMI) would cost you less. And would you really have $40/month? You said that the payment would actually only drop by $20.

Or you could pay the extra closing costs from you savings.

So I'd like the board's opinions on all of that, please and thank you.

If you are looking for 'payment savings', you should look at 30 year mortgages. If you are looking at wanting to have your loan paid off in a certain timeframe, then you should look at loans with a length to match that timeframe. In either case, you need to check with more than just your current lender, because it does not appear that they are offering you competitive rates.

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