How to Drop PMI From Your Loan During a Refinance

By June 17, 2019September 2nd, 2021No Comments
a person signing papers in the home owning process.

Coming back to you with a question I get asked a lot

Having to do with refinancing

“Scott, can I drop my mortgage (by my PMI, if it’s FHA my MIP)..

“Can I drop my mortgage insurance when doing a refinance

Whether it’s a Rate Term Refi or a Cash Out Refi”

And the answer to both is YES

As long as you have sufficient equity in the property, you can do that


Now, one situation I run into a lot

Somebody has a current FHA loan

For those of you that don’t know this

MIP which is FHA’s version of mortgage insurance

MIP is permanent, if you have FHA loan for 30 yrs

you will have it for 30 yrs


I’ve had situations where people said

“Scott, I want to refinance from an FHA loan to a conventional loan,

to drop mortgage insurance.”

But the house did not appraise high enough

And it did not have that 20% equity required to drop the mortgage insurance.


Does it still make sense, to do a loan?

YES and here is why, on a conventional loan that mortgage insurance comes off

So, converting from a permanent mortgage insurance situation

To a temporary mortgage insurance situation, is a WIN


As long as we are looking at the long term plan

Exit strategy, rate term, debt consolidation, etc…

But it can absolutely make sense


That’s what I got for you between mortgage insurance

being removed or maybe converted when you are doing a refinance


Look, everybody’s situation is different

Feel free to reach out to me, email me, DM me..

Whatever you need, outside of that

My name is Scott DiGregorio, I’m Your Mortgage Guy

I’ll see you on the next video, take care.


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