Edit 8/13 3:30pm: Thank you everyone for the helpful advice so far. The lender behind Options A & B contacted me and lobbied for himself, saying there is a $1000 credit towards closing which legally can't appear on the GFE and TIL, but which will be reflected at close. So, cash-to-close numbers have been updated. Also - and this is important - the 15-year loans are conventional, NOT FHA. Sorry for the confusion - new FHA rules will not apply. Lender states I can simply call up customer service and drop PMI when my loan reaches 78% LTV.
I have a feeling the decision now will be more affected by how/quickly much we intend to prepay. For Options A & B, LTV is right now around 91.5% ($339000) and I need to get to 78% ($288,600). So, a little over $50k.
Lender also stated if I prepay more than $5k principal in a 12-month rolling period, I can recapitalize (or something). Any info here is appreciated. I wanted details in print but he was unable to provide them, saying it was simply a part of their "overlays". Does any of this sound familiar? I have asked him for details via Email - especially how this could benefit me.
All numbers below have been updated.
Incumbent: do nothing. Pay the remaining 28.5 years of a 30-year FHA mortgage @ 3.75%, which has a current principal balance of $335,473.22:
Cash up front: (nothing) Monthly payment: $2632.70 Principal and interest: $1614.29 Insurance: $81.17 Tax: $453.38 PMI: $353.86
Option A: refinance into a 15-year conventional mortgage @ 3.5%, borrowing $340,550:
Cash up front: $1713.60 Monthly payment: $3022.48 Principal and interest: $2434.50 Insurance: $87.50 Tax: $375.00 PMI: $175.95
Option B: refinance into a 15-year conventional mortgage @ 3.5%, borrowing $337,250:
Cash up front: $2462.49 Monthly payment: $2996.76 Principal and interest: $2410.95 Insurance: $111.56 Tax: $375.00 PMI: $174.25
Option C: refinance into a 15-year LPMI mortgage @ 3.63%, borrowing $337,250:
Cash up front: $5616.42 Monthly payment: $2843.26 Principal and interest: $2431.70 Insurance: $87.33 Tax: $324.23 PMI: N/A