I want to refinance out of FHA Loan. Very confused about my options, new rules

[Calidreaming]

I just closed on a home last month with an FHA loan. I am now looking to refinance to a conventional loan ASAP so that we can eventually cancel the MI.  I currently owe $358K on the loan and the home appraised for $400K, so I think we could get to 20% equity in well less than 5 years.

I had originally wanted to go conventional, but I have $115K in student loan debt and had to go with a lender that would go up to 50% DTI.  I am on an income-based plan where I pay $0, but they had to use a payment that would fully amortize the loan--$584.  This brought my DTI to 49%.

Since I closed on the home in May, my credit score has gone up 30 points to 691 and I understand that in April, Fannie changed the rule back to where lenders can use the score on the credit report.  I also understand that as of July 29, lenders will be able to go up to 50% DTI. If possible, I'd like to refi right away.  I have found one lender who claims they can refinance me now, but the terms are not nearly as good as other lenders who say they can do it after a waiting period of 6 weeks to 6 months, depending on the lender.  I will list my specific questions below.

1.  I have gotten very conflicting advice about whether lenders can use $0 as a monthly payment where the loan is not in forbearance or deferment.    I read in the FAQ section on Fannie Mae's website that $0 can be used if it is an actual monthly payment from an income based repayment plan.  If the loan is in deferment or forbearance and there is no actual monthly payment, then a fully amortizing payment must be used.  The lender who said they can refinance me now echoes this guidance, but the others I have spoken to insist that $0 can not be used as a monthly payment even if it is part of an income based repayment plan..  Who is right?

2.  How long do I have to refinance if I am just doing a rate/term refinance?  The one who can refinance me now says there is absolutely no waiting period.  The lender I closed with says I have to wait 3 months.  Another credit union has said 6 months.  Then yet another said that I can do it before 3 months, but it will ruin my credit??  Who is right?  Is this a rule from Fannie or is this a lender-specific rule?

3.  What would you do if you were me:  1) go with Lender 1, who can refinance me into a conventional loan right away with the same monthly payment as my FHA loan, but I should be able to cancel the MI in less than 5 years; 2) Go with Lender 2, who will refinance me at a lower rate with a lower PMI rate beginning end of July; 3) go with Lender 3, who has told me to wait until I've made 3 monthly payments; 4) wait until I hit 20% equity and refi then. 

Very confused!

[Anonymous]

I would wait.

Get a second job or drive for Uber to bring in more cash.  Work harder on your credit scores so you can get above 720 across the board.  Come to the table with some more cash and a better score and refinance with a better APR and better terms.

[Calidreaming]

Thanks ABCD. Waiting seems more and more like what we're going to do.

Right now I think I'm just going to wait to the end of July to see if refi is an option with Lender 2  and if not then just wait a year or two so that my credit score will further increase and my equity increases.  Hopefully interest rates won't be through the roof by then. 

I won't be able to raise a lot of cash or get a second job at this juncture in my life since I'm a working parent, but my credit score should improve just by maintaining the status quo for the time being.  We expect that our income will significantly increases and our expenses dramtatically decrease when our youngest is out of daycare. We also need to get a few things like a new mattress, etc. and I'd like to get some zero interest financing instead of waiting until we raise the whole amount.  If we decide to wait a few more months on the refi, my credit score should have rebounded and the balances paid off. 

The mortgage payment is at a comfortable level for us,so If we don't refi immediately it won't be the end of the world. Sure if would be nice to save $200-400 a month but we are thankful we were able to get a house at all at this juncture.