1. When dealing with a refi of a purchase loan, speak to your tax advisor or a QUALIFIED party to explain recourse debt vs. non recourse debt and YOU decide whether this is a concern for you.
2. If recourse debt is not a concern, if you can qualify to refinance and save .25% or more on your rate, (which you should be able to do from 4.25%) at zero cost to you, there is absolutely no reason to not refinance.** Sadly, many people do not get this**
3. With an FHA loan, I assume that you had a very small down payment (3.50%?) Make sure that you compare your MIP (mortg ins) payment on the new loan to your existing payment.
Your payment should drop about least $125 a month.
Assuming that you still qualify, you should be able to get <3.75% at zero cost.
There is no such thing as an easy loan today, but it should be easier than your purchase loan.
