In July of 2003 My wife and I purchased our home with a fixed 30 year mortgage through Washington Mutual. Our down payment (approximately 12%) was less than 20% required to avoid PMI on the loan. Our interest rate was 5.3% with the PMI wrapped into the interest rate in something called .Advantage 90.. Once we were at an 80% loan to value ratio the PMI was supposed to be dropped off making our new rate 4.75%. With the PMI removed, our monthly payment will decrease approximately $100.00.
In August 2005 I called Washington Mutual to find out what I needed to do to get the PMI removed. Without looking at any information, the customer service representative told me I needed an appraisal and said she would send the paperwork to me. I then received the August 26, 2005 letter from Washington Mutual (Exhibit 1) listing a few criteria (no late payments, etc.) telling me to call an appraisal company (LSI Appraisal). It did not list anywhere on the letter that we could not have a Home Equity Line on the property.
I was told by LSI Appraisal the appraisal would be more than $400.
Paying $400 for an appraisal didn't seem like a bad investment to get the PMI taken off. However, at this point I did not know any of the exact numbers. For all I knew, removing the PMI might only save me $1 per month. Or worse, maybe I would pay for the appraisal and Washington Mutual would refuse to take the PMI off for any number of other reasons. So I decided to call Washington Mutual to get some clarification on how much PMI was costing me and if there were any other reasons they might not take it off my loan. The first representative told me that in I did not have PMI on my loan. At this point I had only a vague recollection of a decreased interest rate once we had the 20% equity in the home. I explained this to the customer service representative. She continued to tell me that I did not have PMI. I was pretty certain that I did. So called back and got another representative, who told me the same thing, that I did not have PMI. I continued to insist that I did. At this point I started to get passed around. I was transferred from one department to another and everyone kept telling me that I did not have PMI. I did my best to explain what I remembered. I was given phone numbers that went to voice mail with no one ever returning my calls. I eventually gave up figuring that maybe my memory was wrong. (Exhibit 2 has three (3) additional phone numbers so I know I made at least five (5) phone calls to Washington Mutual in which I was told I did not have PMI on my loan).
Around December 2006 My wife and I decided to do a major remodel to the house. I called Washington Mutual again, only this time I talked to a loan officer .Shawn. about getting a home equity line to pay for the remodel. I asked him about the PMI and he immediately told me that I did in fact have PMI and that it was wrapped into my interest rate. He gave me the exact numbers, the original rate of 5.3% which would be changed to 4.75% saving me around $100 per month. I found it very suspicious that the person trying to sell me a home equity line was the only person at Washington Mutual who could explain this to me. (My notes are attached as Exhibit 3)
I then called LSI Appraisal who came out in January 2007. The appraisal came back as expected; we met the equity requirement to have PMI removed. That same week I received a letter from Washington Mutual saying that effective February 1st my loan would be transferred to Wells Fargo. I knew this would cause problems so I immediately called Washington Mutual. They claimed they had not received the appraisal, but assured me the transition would be smooth and Wells Fargo would honor the request to have PMI removed and honor the appraisal done by LSI. I called Washington Mutual several times to see if they had received the appraisal. They continued to claim that they had not received it. I called the appraisal company and they claimed that they had sent it to Washington Mutual.
On February 1, 2007 I began calling Wells Fargo. They also claimed they had not received the appraisal from Washington Mutual. Again, I called Washington Mutual who continued to claim they never received the appraisal. On February 19th Wells Fargo sent two (2) letters, the first informed me of how to remove the PMI (Exhibit 4), the second informed me that they had not received the appraisal (Exhibit 5). The appraisal company was adamant they had sent the appraisal twice to Washington Mutual who should have forwarded it to Wells Fargo. Finally, on February 23, after several phone calls to Wells Fargo and talking with several different people, I was transferred to a Wells Fargo's customer service representative supervisor, Pamela Miller. She informed me I could fax the appraisal in myself. Why no one told me this earlier, I have no idea. I had wasted nearly a month and if someone had told me to fax it in earlier, I obviously would have. One interesting note, each time I called Wells Fargo and explained that I was trying to have the PMI removed, I was told that I did not have PMI on my loan. In fact, before talking with Pamela Miller I talked with someone named .Kachet. who told me this exact thing (See my notes on conversations with Pamela and Kachet, attached as Exhibit 6). After I explained that I was sure I did and demanded to talk with a supervisor, Pamela Miller did admit that I did in fact have PMI. So with each phone call I wasn't getting any resolution and was forced to jump through hoops for 15-20 minutes while I explained the situation again and again.
On February 27th My wife faxed the appraisal to Wells Fargo (Fax confirmation attached as Exhibit 7).
In early 2007 we decided to get a home equity line from Bank of America to remodel our house. Due to the fact that we had plenty of equity in our home, Bank of America approved the home equity line in February 2007.
Wells Fargo sent us a letter dated February 28th stating they had received our appraisal and would review our request for PMI deletion (Exhibit 8).
In a letter dated March 15th Wells Fargo stated the PMI was no longer a requirement for our home loan (Exhibit 9).
In a letter dated March 16th Wells Fargo stated we had to submit in writing a request to remove the PMI (Exhibit 10).
On March 27th Wells Fargo sent us a letter (Exhibit 11) and a check for $1.60 (Exhibit 12). The letter basically said the check was for the unused portion of the PMI. Since we also received a letter on March 16th, I think I called Wells Fargo and asked them what was going on. On Exhibit 11 I have underlined the phone number and written down what looks like a name, .Wil Wiscousin.. My memory is vague here, but I think I called them and they told me that I just needed to give them verbal communication that I did indeed want the PMI deleted, which I gave them. I.m not sure when, but at some point I called Wells Fargo and asked them what was going on, and someone told me I had to give them permission to remove the PMI. I think it was at this point.
In a letter dated March 30th (Exhibit 13) Wells Fargo sent me another exact copy of the March 16th letter (Exhibit 10) except it was signed be a different customer service rep, Stephanie Guy.
On April 30th I called Stephanie Guy and she told me that she .had been trying to contact me. and that I needed to give her written permission to remove the PMI. She gave me her email address and I immediately emailed her telling her I wanted the PMI removed (Exhibit 14).
From here on out I realized that Wells Fargo was giving us the run-around so I carefully took notes each time I talked with them. All the notes are hand scrawled but I do have them if needed.
On May 16th someone at Wells Fargo called me and said they could not remove the PMI because of the home equity line. Construction on our remodel started in late April, so by the time Wells Fargo called to say that they would not remove the PMI, literally 1/3 of our house had been demolished and we had started to make payments to the contractor.
On May 16th I called Wells Fargo to follow up with the phone call I received that morning. I talked with .Dion.. He again told me I did not have PMI. I insisted I did. He finally admitted that I did have PMI and said it was going to be removed. I asked him for some exact numbers. For some reason he could not figure out the new numbers. I then asked to speak to a supervisor. Dion transferred me to Amy Delacerea (her direct line at Wells Fargo is 414-214-4585). Amy told me the confusion with my PMI was because I actually had something called .Advantage 90. which allowed the PMI to be rolled into the interest rate. This was the first time anyone ever told me this. She said what I was actually trying to get was an .interest rate deduction.. I explained my entire story to Amy and she agreed that it did seem unfair.
In a letter dated May 15th Wells Fargo again said that the PMI would be deleted and actually gave us a new interest rate and monthly total effective June 1st (Exhibit 15). We signed and notarized the letter and immediately sent it back.
On May 18th Amy called to say that in order to have the PMI removed we would have to cancel our home equity line. I did not think this was possible, as the construction had already begun. She also mentioned that if we refinanced the whole loan we might not need PMI since we now had so much equity in the house. We had a very good interest rate of 5.3% so refinancing would have dramatically increased our overall payment, even given the fact we no longer needed the PMI.
On May 19th I went to Bank of America to ask how feasible it would be to pay off the home equity line, have the Wells Fargo PMI removed, and then reinstate the loan. I was told it would be a simple process. However, since demolition had begun, removing 1/3 of the entire house, we would probably not qualify for the same equity line amount. If I cancelled the home equity line at this point, we would not be able to complete our remodel.
On May 21st I called Amy to explain that we could not, at this late date, remove the home equity line. She said she would talk with her supervisor.
On May 24th .Raven. left me a message saying that I only had two options, either refinance or drop the home equity line. Raven left no contact information. I immediately called Amy. She and I had already discussed these options so I really didn.t understand why they would call me to mention them, when they were clearly not options. Amy said she would take the case to a supervisor.
On May 30th Amy called me and left a message saying that they were discussing an exception for my loan to remove the PMI.
Around June 1st I talked with Amy and she said that some group was having a meeting to figure out if they could either make an exception for me or simply remove it as a requirement for all loans. I never heard anything back.
On July 23rd I called Amy and left her another message asking what was going on with my PMI removal. She never called me back.
On September 4th I called Amy and she said that someone should have called me (no one ever did) to tell me they could not remove the PMI from my loan unless I got rid of the home equity line.
If Wells Fargo had processed our request to remove PMI in a timely manner they would have notified us that the home equity line needed to be dropped before PMI could be removed, while we were still in a position to remove the home equity line. Construction on our remodel did not start until April 22nd, 2007, and in fact the home equity line balance remained at zero until April 26th, when we wrote the first check to the contractor. Wells Fargo did not tell us that removing the home equity line was a requirement until mid- May, when it was far too late to remove the home equity line.
Wells Fargo took over the loan on February 1st 2007. I had already gotten the appraisal done in January. Everything was ready before they even got the loan. I can understand that it might take some amount of time, but for the first month (all of February) they simply stalled and gave me the run around. Then in March they sent me letters telling me that in fact the PMI would be removed. Then in May when they reversed their decision to remove the PMI, it was too late for me to remove the home equity line.
If in February, instead of giving me the run around, they had told me that they could not remove my PMI until I dropped the home equity line, I could have easily dropped it.
If in March, instead of sending me letters telling me they were going to remove the PMI, they had told me that they could not remove the PMI until I dropped the home equity line, I could have easily dropped it.
It appears to me that Wells Fargo implements several lines of defense to try and prevent people from removing the PMI. First, they don.t train their customer service reps well enough so that the entire process is slowed down to a near crawl. They make customers jump through hoops. And then once I.ve jumped through the hoops they send out letters indicating that everything is all right, when meanwhile all they.re doing is stalling in order to find another reason that that they shouldn.t remove the PMI.