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My Wellsfargo Refi Experience (Today)

I finally got a hold of someone from a local Wellsfargo loan branch in Ohio.

First of all, I want to say that all Wells representatives are very courteous and helpful. I didn't feel like I was rushed or pushed around. So having said that, this is my experience with Wells today.

I had initially filled out a "please contact me" form through my wellsfargo.com account. Three days later, someone called me. I didn't get back to him until today (3 days later and it's totally my fault)

When I told him my situation (5 yr ARM resetting in 2011), he said that there's not much he can do because I don't have at least 20% equity but he did say that I quality for a "3 Step Refinance".

3 Step Refinance from Wells is apparently a no fee process where all they do is to switch you from one product (ARM) to another (30 year fixed). Sounds good right?
So I call the 800 number the first Wells rep gave me.

As it turned out, the 3 Step Refi program doesn't apply to me because guess what... I don't have 20% equity.

Again, my entire experience has been great. It's really at no fault of Wells that I can't get any help. At any rate, the 3 Step Refi representative advised me that the only thing he can do is to forward my contact information to a regular loan officer and it might take a few business days for someone to get back to me again.

At this point, I don't think I can get any help from Wells. I have a feeling that when the regular loan officer will tell me the same thing as what I've been told over and over again today.

Thoughts?

Thanks!
  • January 22 2009 - Westerville
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Answers (20)

Gd,

Dfors is OK doing what he is suggesting.  It's OK to collect rent on a second home you simply cannot use the income to qualify and you cannot have a rental agreement (if you do you do not have exclusive conrol over the property)

That's unless you are referring to not reporting the income on his tax returns...That's a problem for the IRS I don't see how the 4506T would tip Uncle Sam off that he is collecting rent and not reporting it!

  • January 23 2009
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dfors,

"I have no formal rental agreement.  I do record the rent on my taxes though."

A 4506T will be part of your loan package so be very careful doing what you are thinking of doing.
  • January 23 2009
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thebittersea,  I agree with Ken.  FHA will allow a rate and term refinance up to 97.75%.  If the appraised value comes in at what you owe, you would only need  2.25% plus the closing costs, as cash to close.
  • January 23 2009
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When i refinancing my 2nd house, I tell to Citimortgage loan officer,  " That is my investment property "
and she OK with that, she give to me the rate same as primary house, and after that she ask me show to
her, the rental agreement ( the prove of rental income ).
  • January 23 2009
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no rental agreement then you have nothing to worry about.  You can collect rent it can't be used to qualify, but it's OK to collect it.  Although I would avoid provident on the refi when the time comes...I can see them refusing to consider it a 2nd home because of the rental income.
  • January 23 2009
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Andrew,

  I have no formal rental agreement.  I do record the rent on my taxes though.  With the banks screwing America and with the new secy of the Treasury being a tax cheat I don't think I will be Mr goodie two shoes too much longer.
  • January 23 2009
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If you have a rental agreement in place it should not be considered a 2nd home.  Not sure how it would be found out but it would not meet fannie mae guidelines.

Second home properties.A second home is a property that is located within a reasonable distance from the borrower’s principal residence and which the borrower occupies for some portion of the year. We limit our purchase of mortgages that are secured by second homes to those properties that have one dwelling unit. The property must be suitable for year-round occupancy (and can, in fact, be occupied by someone other than the borrower—as long as the occupancy is not under a timeshare arrangement). The borrower must have exclusive control over the property; therefore, he or she must not enter into any rental agreements that require the property to be rented or give a management firm control over the occupancy of the property. When a property is classified as a second home, rental income may not be used to qualify the borrower.Conventional second mortgages may not be secured by a second home.
  • January 23 2009
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I'm with Ken and think you may want to contact a lender/broker who does FHA. They go above 80% LTV. 
  • January 23 2009
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Andrew,

It actually was a second home at the time of purchase and was to refi as such.  The home is in a popular ski town.

  • January 23 2009
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dfors,

You have a whole nother issue with it beng an investment property.  That will cost you an additional 1.75% in price after 2/25..new Fannie Freddie LLPA's
  • January 23 2009
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Bitter,

My loan is a fixed 15 yr loan at 5.75%.  Not bad.  I have 11 yrs left due to prepaying.  Was hoping for a 5% 30 to free up monthly budget money for other stuff.  Given the carnage that is out there I consider myself lucky.  I will either stick with the loan or prepay until I qualify under the new appraisal.  Home is currently rented by my sister in law for cheap.  With the refi I would break even on interest and property taxes.
  • January 23 2009
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Ken

They asked me "what I think the value of the house is" over the phone and i gave them an honest answer... it's probably right at the loan balance range.

Maybe I shouldn't have said that. But they will find out either way when they appraise it and my application will get kicked out.

Thanks!
  • January 22 2009
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Tammy

My house appraised at 340K and now if I'm lucky It's barely above my loan balance, which is around 270K.

My credit score is above 750.

Thanks!
  • January 22 2009
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Greg, I think, from what I gather, that they are around 95k in the hole.  I could be wrong though.  Doubtful anyone from Zil can help.
  • January 22 2009
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TBS, how do they know you over 80%? Did they do an appraisal?

Are you under 97.75%? If you are planning to stay in the home long term, have you look at fixed rate FHA programs?
  • January 22 2009
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I just emailed my experience to Wellsfargo's executive team

John.G.Stumpf@wellsfargo.com, Howard.I.Atkins@wellsfargo.com, James.M.Strother@wellsfargo.com, Richard.D.Levy@wellsfargo.com, Mark.C.Oman@wellsfargo.com, David.A.Hoyt@wellsfargo.com, Carrie.L.Tolstedt@wellsfargo.com, Michael.J.Loughlin@wellsfargo.com
  • January 22 2009
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Sounds like Wells Fargo did the good old, "Washington 2-step," on you.
Do yourself a favor and submit a loan request on Zillow.
  • January 22 2009
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Bitter,

What is your loan amount and what is your house value?  Credit score.
  • January 22 2009
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dfors2.

Gosh, I really don't want to bleed another 95K and still be in the "hole". I probably can't keep up with the current depreciation rate of my real estate. What are your options? Care to share a few ideas? Are you in a fixed product or ARM?




  • January 22 2009
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I have tried to refi with Wells as well.  Despite paying down the mortgage by 95k I am still not at 80 LTV.  I was told to come back when I had an additional 35k.  I also had helpful staff and used my usual lender who has helped me on a number of loans.  If something doesn't change the banks are going to own a whole lot of homes.
  • January 22 2009
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