I just signed docs tonight. My scenario is unique, so your results may vary. I originally bought with 5% down FHA 6% no points, then about a year later refi’d for 5% with no points, still FHA. My reasoning at the time was I needed my cash because my trashed repo needed me to put cash into it to make it livable and I was scared about the coming apocolypse due to the many wing nut posters here talking about spam and ammo.
Well despite all the prognostications of the wasteland and overbuilt Temecula that I was buying in, the opposite occured. We churned through the inventory and the bubble purchases folded before the moratoriums and the prices have risen slowly since. So much so that despite putting 5% down about 2 1/2 years ago and about the equivalent of another 5-10% in repairs, my appraisal came in showing I had 30% equity. So my refi was conventional and a no points 4 3/8 but I got out of the PMI and a pro rated MIP refund. I figure the the drop in payment is between 15 and 20% (mostly because of the PMI), effectively the difference between a 30 and a 15 year loan. If I make the same payment as I had been making the refi can effectively bring me close to a 15 year loan. At a minimum, I shaved 10 years off my mortgage. I’m lucky with respects to the increase in value and because I have a childhood friend in the loan biz, but I didn’t do anything anyone else couldn’t do. In fact i could have gotten a better rate, but I always choose the cheapest option, in fact I’m getting a bunch of money back because of the bloated escrow account, the higher than market rate, skipping a payment and the MIP rebate. I’m against paying points, always have been, life is too fluid. Now I don’t have a view of T.J. mind you, but I digress.
Now I have to go get some ice for my arm, it’s sore from patting myself on the back.
