[onewhippedpuppy]

Terry, are you the DIY type? If you can remodel and build that 20% in equity (instead of cash), you should be able to refinance.

To explain, say you totally remodel the house, and have it appraised by an independent appraiser. Most of the time, any loan values will be based upon the appraisal, as you're typically dealing with a national bank that does not have their own appraisers. If your home appraises high enough, you essentially get 20% in equity (sweat equity). Even though you're borrowing 100% of your purchase price (or close to it), the extra equity is like a virtual down payment. Also, you get off of the hook for PMI. Just a thought.