I own a 4 unit property in Denver that I financed with FHA financing about 2 years ago for 630K with a 3.75% interest rate back in Aug 2017. My mortgage payment is $3,481.77 with about $400 of that going to MIP, and I would like to refi out of it to eliminate my MIP and potentially use it again for a future multifamily property.
I lived there one year and then moved out, but I have improved 3/4 units, and I'm looking to potentially refi out of it into a conventional loan to free up my FHA loan to use again down the line.
As of today, I owe 576K, would it be worthwhile for me to look into a non-cash out refinance into a conventional loan? I think it is worth between 725-775k today.
1) Do I need to have 25% equity to get rid of my FHA MIP completely and into a investment property conventional loan?
2) I own this property, another single family house investment property, and my current primary residence, how much in reserves will I need?
1) Yes. If needed, you can come in with funds during a refinance.
2) 6 months PITI (new payment) on subject, 2% of the balance of the other rental, none on the primary.
Read some of the other threads on here for strategies to maximize refi appraised value, to minimize the chances of a low appraisal, or at least mitigate it.
@Chris Mason Great, thanks for the quick response!
@Chris Lopez Thanks Chris, I was just about to reach out to Joe!
Hey @Jeff White - Chris is right, give me a call and we can run through some options. you do need at least 25% equity and 6 months reserves, but based on what I know about your scenario, it certainly makes sense to review it. Look forward to hearing from you!