[HardDrive]

I'll spare you a long backstory. My sister has a horrible mortgage, bought at the top of the market in 2008ish, was underwater for a long time.....terrible deal.

Their current loan to value is about 87% (based on a really crappy appraisal), but they were offered a refi, the catch being that they would need to pay PMI for the next 5 years. Unless of course they simply refi again when they can get a more favorable appraisal. They live in Highland Park in LA, and prices are marching up pretty fast.

If I'm understanding the situation correctly, their broker is telling them that they can refi again in 6 months, and with the exception of the appraisal, they won't pay his fees again.

My questions:

A) The 6 month limitation, that's only if they go to the same lender, and not all lenders have a 6 month limitation, yes? If they went to different lender, they could refinance right away, correct? (I'm assuming that there is no early payoff penalty on loan one).

B) Doesn't it make a crap load more sense to take the cash they have in the bank, and PAY DOWN THE LOAN SO THAT THE LTV IS 80% SO THEY CAN GET A NON PMI LOAN, JUST LIKE I HAVE BEEN TELLING THEM TO DO FOR 5 FLOKING YEARS, BUT THEY WON'T DO IT BECAUSE THEY HAVE THEIR HEADS UP THEIR ARSES.

Seriously, I don't even know what to say to them anymore. Its almost like they are in a pact to make the dumbest decision possible.