Dealing with Wells Fargo and Eliminating Mortgage Insurance -

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Real Estate Agent with Value Added Service, 602-620-2699 SA5376460000

Dealing with Wells Fargo and Eliminating Mortgage Insurance - 

 

Recently, I had the grand idea of getting rid of my Mortgage Insurance. I knew I would have to be Dealing with Wells Fargo to Eliminate Mortgage Insurance, but I figured I was game.   I should say that the only reason I have Mortgage Insurance is because I, like millions of others, sold my home after losing a great deal of money in the Housing Recession.  And the biggest reason I sold it was that I couldn't refinance as I was upside down, still had equity, and couldn't reduce the interest rate for that very same reason.  It made no financial sense to keep paying for something that, even to this day, is not what I paid for or upgraded.  And my interest rate was higher, making the payment higher than it would be today.

Fast forward to 2 years ago.  After renting a luxury condo (what fun) for three years, I bought a house. I elected to use Conventional financing and put 5% down due to the low interest rates.  It wasn't what I had before, but it was mine.  I've since added new ceiling fans, upgraded the faucets  and added custom paint throughout and fixed everything as this was an "as is" purchase.  It really shines and because it's newer construction, it's also more energy efficient.  So, I'm winning all the way around here.  That is until I decided to apply to eliminate MI, Dealing with Wells Fargo to Eliminate my Mortage Insurance. 

We all know that when we purchase a home, the loan is sold within the first 6 months to God Knows WHO!  I ended up with Wells Fargo.  Hurray, at least it's now entitled me to some fringe benefits since my other accounts are there.  I wasn't going to do this, but my stockbroker's company was bought by Wells Fargo, so there you have it.  I'm sorta stuck because I love my broker and friend of 30+ years. Aw, but I digress.  

Applying to Eliminate the Mortgage Insurance includes the need for an Appraisal.  I do my due diligence, seeking out comparable sales from my neighborhood and a "sister" neighborhood.  Thinking I'm good to go, I send in the form and know that I'll be charged $365 for the appraisal no matter what happens.  

The appraiser shows up at my home, does her walk through, measuring and taking photos.  We chat in my office, because I work from home. It's clear that I'm a REALTOR® and I give her my comps.  

Ten days goes by and I receive the appraisal.  I'm shocked to learn that not only did she dismiss the "sister" neighborhood comps, she uses a home that is 14 years older than mine in a different neighborhood as the most influential for deciding the value of my home.  The end result is that she has given me a value less than smaller homes in my neighborhood (300 square feet smaller) and placed the most focus on a 19 year old home with the same square footage as an easy out!  From the Appraisal fine print: 

Dealing with One of the Big 5 & Eliminating Mortgage insurance

Can you imagine an appraiser that uses a 19 year old home only because it is the same square footage, the easiest route, to form an opinion of value.  The home is completely vanilla, much older and not in my neighborhood.  I'm hot on the trail to call Wells Fargo, but first I call an Appraiser.  This appraiser is a friend of mine who owns a company with at least 10 of his own appraisers on the payroll.  He's also an instructor and we've done speaking panels together. I explain what happened with the appraisal to him and he asks to see the appraisal.  


"Sloppy work."  Is the first expression from my appraiser partner.  He of course says that Wells Fargo will use their own RELS appraiser  and that he's personaly had to re-train 2 that he hired so they value properties effectively.  He's a true professional and I trust his wisdom implicitely.  

His advice, apeal the appraisal.  "Obviously she went outside the neighborhood, used the main comparable sale that is 19 years old";  my home is 7 years old.  Mine has 2 year old carpet and brand new custom paint and is in perfect condition as I've fixed and maintained everything with upgraded fans, fixtures.  

Receiving the forms from Wells Fargo, I resubmit comparable sales that are $15,000 higher in sales price and still 200 sq ft smaller than my home.  

Hopefully this will be enough evidence for Wells Fargo to see the light and eliminate my Mortgage Insurance.  Doing this as a professional in the business, I can only imagine the frustration from the public.  I have access to the comps and can perform this work easily.  

Stay tuned, because I'll write another public blog if they don't do the right thing and recognize the true value of my home!  Dealing with One of the Big 5 and Eliminating Mortgage Insurance is frustrating!

 

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Ambassador
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John McCormack
Albuquerque Homes Realty * www.AlbuquerqueHomes.com - Albuquerque, NM
AlbuquerqueHomes.com, Albuquerque Homes Realty

Good morning Jan.  To be honest I don't like dealing with Wells Fargo or Bank of A either one!  Seems like they drag everything out and then it ends up a big mess just as you have described. 

Aug 26, 2014 01:23 AM #6
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Bob Crane
Woodland Management Service / Woodland Real Estate, Keller Williams fox cities - Stevens Point, WI
Forestland Experts! 715-204-9671

Hi Jan, perhaps it would be wise to include a link to your blog post with your next letter to them, pointing out that thousands of real estate people will be following the story, and it is up to them as to the message that they want to send to the real estate world.

Aug 26, 2014 05:59 AM #7
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Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

Eliminating mortgage insurance with Wells Fargo sounds like a nerve wracking experience.

Aug 26, 2014 08:15 AM #8
Rainmaker
876,982
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

John - You understand better than anyone!

Barbara - Thanks for that!

Roy - We can try!

 John - It's the big 5!

Bob - Excellent idea1

Chris Ann - It is and has been.  They ignored comps in my neighborhood, didn't call in pending listings that were closing in 2 weeks and failed miserably!

Aug 28, 2014 02:23 PM #9
Anonymous
john

i don't think I'll spend the $365. I have a PMI account with Wells Fargo. I tried to find out whom this RELS appraisal company is in my area. They won't release that data, they only, I'm told 'deal with lending institutions'. These jack asses don't want to help, they are in lock step with lenders and only care about the cash. So, what's a fella to do, pay the mortgage down to 78% of the original value of property at time of purchase and forego the nonsense. All because my lovely wife needed a nice house, oh well - Happy wife, Happy life. John

Dec 04, 2014 04:47 AM #10
Rainmaker
876,982
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

John - I hear you.  The RELS AMC is owned by Wells Fargo, so a bit of hand holding going on.  

I'm waiting for one more sale IN MY NEIGHBORHOOD to show that yes, I do have the equity I claim I do so that I can pay for yet another $365 appraisal.  

They botched the first one, as I mentioned above, by not using a comp in my neighborhood that was 200 sq ft smaller to value my house less than that house.  All of the neighborhood was built in 2007, and yet they thought it wise to compare my home to one 14 years older!  Nonsense!  

I figured the appraisal was botched and when I showed it to an appraiser/instructor he confirmed it.  AND he went on to tell me that he has hired some of the RELS appraisers and had to re-train them.  Speaks volumes to me as a residential realtor of 12 years.  Oh well - 

Dec 04, 2014 05:15 AM #11
Anonymous
B

I hope everything goes well with your appeal
I just started my own appeal
My story is extremely similar to yours it's almost as if none of the information mattered to apprasier. rather, it seems they had a target which would be below my qualifying amount to hit

the appraisal had gross Errors such as the bedroom count.... Not good

Dec 20, 2014 12:04 AM #12
Rainmaker
876,982
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

It is very difficult to deal with RELS as Wells Fargo owns them.  Make sure to have solid comparable sales of the same square footage.  Mine were smaller and RELS was not able to verify their square footage, go figure.  Since I am a full time realtor, I have a clue about square footage, but it seems that RELS has no idea how to verify square footage and compared my home to one 14 years older only because of similar square footage.  I'm amazed!  Good luck with your appeal.  I will have to pay for another appraisal in order to get them to see the light!

Dec 29, 2014 12:52 AM #13
Anonymous
R Gomez

I have had a similar experience with Wells Fargo on this subject. They were much more forthcoming when dealing with me. They told me that their appraiser did not care about the comparable homes in my neighborhood. The Appraiser would only look for structural modifications to my home. If there were no structural modifications complete, then the value would not increase. The homes in my neighborhood are selling for 30% more than when I purchased. This is fraud.

May 28, 2015 02:40 AM #14
Rainmaker
876,982
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Yes, it's very frustrating!  As a real estate professional, I'm appalled at the service I received and answers that were less than truthful.  They didn't give me the proper value because they couldn't "locate the square footage' on a house that sold 2 doors down from me, that was 200 sq ft smaller.  My value came in less than that sale on my same street.  Very frustrating!

May 28, 2015 05:35 AM #15
Anonymous
Jessia

Hi there!
Any updates about your PMI removal by Wells Fargo? I am in the same boat. Just caught the RELS appraiser snooping around my house 2 days before our appointment. I smell something fishy.

Jun 10, 2015 04:24 AM #16
Rainmaker
876,982
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

No recent updates.  It's still the same story.  Be ready to meet them with a list of updated items as well as cost of upgrades during your ownership.  Have a list of recent sales ready with the square footages being in close range of your own home.  There isn't any easy way to make sure an appraisal comes in at value, just be armed with informatoin!

Jun 10, 2015 04:30 AM #17
Anonymous
darryl

make sure your IMPROVEMETS are what bring the value up to over 80%. Just because home prices are rising will NOT eliminate PMI. I went through this, After paying for the appraisal. Best revenge is sweet, refinance, obviously not with WF!!! if you truly have the 20% equity in fair market value, you should be able to re-fi on the cheap.

Sep 11, 2015 01:14 AM #18
Rainmaker
876,982
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Darryl:  Of course, but in this case there were no improvements.  I've since rented that home and the appraisal was $24,000 higher, no improvements, than the RELS Wells Fargo appraisal.  They simply did  poor job appraising my home because their appraiser didn't comp it correctly.  I have 30% equity and bought another house. 

Sep 12, 2015 08:45 AM #19
Anonymous
Anonymous

Jan, The banks don't issue the Mortgage Insurance for your loan. There are several MI companies such as MGIC, Radian, Genworth etc... who issue the mortgage insurance. Your loan paperwork will identify directly who that company is and you may be able to reach out directly to the mortgage insurance company. As far as appraisers goes, RELS pulls appraisers from local independent appraisal companies. The misconception in the lending world is that its always the banks fault but it truly is not. There are a lot of "Hands in the cookie jar" in the real estate and mortgage industry and big government regulation plays a big part in what can and cannot happen. Good luck to you. I hope you try the alternate approach and go right to the source of the MI. If you don't have your paperwork, WF should be able to tell you who the MI company is that has insured your loan

Oct 16, 2015 05:10 AM #20
Rainmaker
876,982
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Dear Anonymous, I can appreciate that banks don't create mortgage insurance, but I have to go back through my mortgage company to eliminate it.  I will reach out and see if I can eliminate it because my appraisal now 6 months later is $23,000 higher !   RELS has a rep for providing inaccurate, low appraisals per a few AMC's here in town.  

I found out that Radian Guaranty Inc is the holder of the PMI and they will not just eliminate it.  I have to go back through Wells to be able to eliminate it. 

Thanks for responding and good luck to you as well! 

Oct 19, 2015 07:55 AM #21
Anonymous
Brianne

Hello. Thank you for writing this blog. I am in nearly the same situation; I had an appraisal done through Rels to try to get rid of my PMI with my Wells Fargo mortgage. The appraiser used comps that were homes older and a different number of bedrooms than my own home. I had a friend who is a real estate agent check out the report and do his own comps (which he said there were plenty of more relevant comps in my neighborhood the appraiser should have used) and estimated my home to be worth nearly $45K more than what Rels said. I'm curious how your appeal is going and if you have heard of anyone else being successful in the appeals process. Thank you!

Apr 14, 2016 03:13 AM #22
Rainmaker
876,982
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Your situation sounds much like mine.  I did not win my appeal.  It's very difficult to deal with RELS and Wells Fargo.  RELS is their appraisal management company and the appraisers there are not well trained.  A friend of mine who has his own AMC has hired a few of RELS appraisers and has had to re-train them.  These same appraisers have also trained to understand solar and agreen features as they pertain to residential and commercial homes and buildings, so much better trained than RELS in that regard as well.  Ihost those courses for appraisers as a volunteer with the US Green Building Committtee. I've sat through those courses so I have a fair idea of how appraisers should be competent, and especially in your neighborhood. 

Your friend that is an agent can help you with your appeal by using relevant comps and the same square footage and bedrooms.  You can ask the apprasier that came to your home if they have ever worked in your area before.  If not, they may not understand homes in your area, which could also relay to how well they understand your home and it's value.   Best of luck!!

Apr 14, 2016 03:26 AM #23
Anonymous
Joseph Schwartz

Thanks for posting your experience with WF and their appraiser. I was able to get our LTV down to 79.9%. But, since we haven't made any improvements to our property, I'm worried they'll decline. Our county property taxes went up significantly, since our house is now taxed at about $25000 more than when we moved in about 4 years ago. Looks like we might refi instead.

Jul 16, 2016 12:30 PM #24
Anonymous
Dennis

Wells Fargo is giving everyone the run around the loan to value rate is based on your original purchase price, not what its worth now. They tell me that my 30 year loan which was taken out in 1995 that I have to pay for 30 years. They lied. Where's the money going? I think there putting it in there pocket.

May 20, 2018 11:15 AM #25
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