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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.

Yes, she definitely said '78%' in context of a conventional 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.

She said my credit score when last checked was 780.

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.

Right now my payment is about $660, and that includes $40/month for insurance. Refinancing to a 15-year loan would increase the payment by $20, but if the figures work out that I don't need insurance at all, then that saves $40/month for a net savings of $20/month. That's my understanding of it.

you need to check with more than just your current lender, because it does not appear that they are offering you competitive rates.

Will do. Thank you.
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