I purchased my home for 195,000, 30yr fixed FHA loan @ 4 percent with PMI insurance for five years. I owe 160,000. It is appraised for 280,000. Currently my payment is 1,467 including taxes/ insurance. My PMI being 180. I would like the PMI to come off and lower my payment
Ive been given the option to Refinance @ 3.875 30 yr conventional fixed which would drop my payment to 1,164. However closing cost (6000) would be rolled into the new loan which would total 166,000.
If I did not refinance I would still have to pay PMI for another 12 months which equals 180x12=2,160.
Old payment- 1,467
New payment-1,164
Saving - 303
Payment without refinance in 12 months -1,287.
I feel like refinancing is the better option but the 6,000 closing cost is what Im not a big fan of. Do you guys think its a good decision? Should I wait for the PMI to come off first then refinance to get a possibly lower payment?
Thanks!