Are you currently paying Private Mortgage Insurance (PMI) on your Wells Fargo mortgage and wondering how you can finally get rid of it? You're not alone! Many homeowners find themselves in this exact situation, looking for ways to reduce their monthly mortgage payments and gain more equity in their homes. The good news is, while PMI is often a necessary part of getting a mortgage with a smaller down payment, it's generally not a permanent fixture. This comprehensive guide will walk you through the process of removing PMI from your Wells Fargo mortgage, step by step.
What is PMI and Why Am I Paying It?
Before we dive into how to remove it, let's quickly clarify what PMI is. Private Mortgage Insurance (PMI) is an insurance policy that protects your lender (in this case, Wells Fargo) in case you default on your mortgage payments. It's typically required when you take out a conventional loan with a down payment of less than 20% of the home's purchase price. While it protects the lender, it adds to your monthly mortgage payment without directly benefiting you as the homeowner. Understanding this is the first crucial step in motivating yourself to get it removed!
Now, let's get down to the business of shedding that extra cost.
Step 1: Understand Your Current Loan-to-Value (LTV) Ratio
The core of PMI removal hinges on your Loan-to-Value (LTV) ratio. This ratio is a comparison of your current outstanding mortgage balance to your home's current market value or its original purchase price, whichever is lower. Wells Fargo, like other lenders, uses this ratio to determine your eligibility for PMI cancellation.
How to Calculate Your LTV:
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Find your current mortgage balance: Look at your most recent Wells Fargo mortgage statement or log into your Wells Fargo online account.
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Determine your home's value:
- Original Purchase Price: This is the easiest to find and is usually what Wells Fargo will consider for automatic PMI cancellation.
- Current Market Value: This can be a bit more fluid and might require an appraisal (more on this later). However, if your home's value has significantly increased since you bought it, this could be your key to early PMI removal.
Example: If your original loan was $200,000 and your home's original purchase price was $250,000, your initial LTV was 80% ($200,000 / $250,000). If your current balance is $180,000 and the original purchase price was $250,000, your LTV is 72% ($180,000 / $250,000).
Step 2: Know the Automatic PMI Termination Rules
The Homeowners Protection Act (HPA) of 1998 mandates that lenders automatically cancel PMI under certain conditions. This is often the easiest way to get rid of PMI, as it requires no action on your part, other than making your payments on time.
Key Automatic Termination Milestones:
- 78% LTV of Original Value: Wells Fargo is generally required to automatically cancel PMI when your loan's principal balance is first scheduled to reach 78% of your home's original value at the time your loan was closed. This is based on your original amortization schedule, assuming you make payments on time.
- Midpoint of the Loan Term: Even if you haven't reached the 78% LTV threshold, Wells Fargo is often required to cancel PMI when you reach the midpoint of your loan term (e.g., 15 years into a 30-year mortgage), provided you are current on your payments.
It's important to note: While automatic termination is a relief, it might not be the fastest way to remove PMI, especially if your home's value has increased significantly.
Step 3: Explore Options for Early PMI Cancellation (The Proactive Approach)
If you're eager to stop paying PMI sooner than the automatic termination date, you can often request its cancellation. This usually involves demonstrating that you've reached a certain equity threshold.
Sub-heading 3.1: Reaching 80% LTV Through Payments
This is the most common path to early PMI removal. Once your loan balance is paid down to 80% of your home's original value, you can typically request that Wells Fargo cancel your PMI.
- Actionable Tip: Consider making extra principal payments on your mortgage. Even small additional payments can shave years off your loan term and help you reach the 80% LTV threshold faster. Make sure any extra payments are clearly designated to be applied to the principal balance.
Sub-heading 3.2: Leveraging Home Appreciation (New Appraisal)
If your home's value has increased significantly since you purchased it, this could be your golden ticket to early PMI removal. You can request a new appraisal to demonstrate that your current LTV (based on the new, higher value) is at or below the required threshold.
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What to Consider:
- Cost of Appraisal: You will typically be responsible for the cost of a new appraisal, which can range from a few hundred dollars. Weigh this cost against your monthly PMI savings.
- Equity Threshold: Wells Fargo may require you to have at least 20% equity (meaning an 80% LTV or lower) based on the new appraised value to consider PMI cancellation. In some cases, if your loan is relatively new (e.g., less than two years), they might require a higher equity percentage (e.g., 25% or 75% LTV).
- Good Payment History: You will generally need to have a good payment history, meaning no recent late payments.
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When to Consider an Appraisal: If you've made significant home improvements, or if property values in your area have been steadily rising, a new appraisal might be a worthwhile investment.
Sub-heading 3.3: Refinancing Your Mortgage
Refinancing can be a powerful tool to eliminate PMI, especially if interest rates have dropped or your credit score has improved.
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How it Works: When you refinance, you essentially take out a new loan to pay off your old one. If your new loan's LTV is 80% or less (based on your home's current appraised value), you won't be required to pay PMI on the new loan.
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Things to Evaluate Before Refinancing:
- Closing Costs: Refinancing comes with closing costs, which can be thousands of dollars. You need to determine if the savings from eliminating PMI and potentially getting a lower interest rate outweigh these upfront costs.
- Loan Term: Consider if you want to keep the same loan term or shorten it.
- Your Financial Goals: Does refinancing align with your overall financial objectives?
Step 4: Contact Wells Fargo to Initiate the Process
Once you believe you meet the criteria for PMI removal, it's time to reach out to Wells Fargo.
Sub-heading 4.1: Gather Your Information
Before you call, have the following ready:
- Your Wells Fargo mortgage account number.
- Your current mortgage balance.
- The original purchase price of your home.
- Any details about recent home improvements, if applicable.
Sub-heading 4.2: Reach Out to Wells Fargo Mortgage Customer Service
The best way to start is by calling their mortgage customer service.
- Wells Fargo Mortgage Customer Service Number: You can typically find this on your mortgage statement or on the Wells Fargo website. As of June 2025, a common number for Wells Fargo mortgage customer service is 1-866-234-8271.
- Be Clear and Concise: Clearly state that you are calling to inquire about removing Private Mortgage Insurance (PMI) from your loan.
- Ask About Their Specific Requirements: While the HPA sets federal guidelines, lenders can have specific procedures. Ask Wells Fargo about their exact requirements for early PMI cancellation based on your situation (e.g., 80% LTV through payments or a new appraisal).
- Request Information in Writing: Always ask for any applicable forms or detailed instructions to be sent to you in writing.
Sub-heading 4.3: Submitting Your Request (If Required)
Depending on your situation, Wells Fargo may require a formal written request and/or documentation.
- Written Request: If you're requesting cancellation based on having reached 80% LTV, a simple letter stating your request, your account number, and your belief that you meet the criteria, along with your good payment history, might suffice.
- Appraisal Request: If you're relying on increased home value, Wells Fargo will likely require you to order a new appraisal through a Wells Fargo-approved appraiser. They will guide you through this process. You will pay for this appraisal.
Step 5: Follow Up and Monitor
The process of removing PMI can take some time. Don't be afraid to follow up regularly.
- Set Reminders: Mark your calendar for follow-up calls or to check your Wells Fargo online account for updates.
- Review Statements: Once your PMI cancellation is approved, ensure that your monthly mortgage statements reflect the removal of the PMI charge.
Step 6: Enjoy Your Savings!
Once PMI is successfully removed, you'll see a noticeable decrease in your monthly mortgage payment. This extra money can be used for anything from building your savings, investing, or making even larger principal payments on your mortgage to pay it off even faster!
10 Related FAQ Questions
How to Calculate My Current Loan-to-Value (LTV) Ratio?
To calculate your LTV, divide your current mortgage balance by your home's current market value (or original purchase price, whichever is being used by the lender for the calculation). For example, if your balance is $150,000 and your home's value is $200,000, your LTV is $150,000 / $200,000 = 0.75 or 75%.
How to Know When Wells Fargo Will Automatically Remove PMI?
Wells Fargo is generally required to automatically remove PMI when your loan's principal balance is scheduled to reach 78% of your home's original value, based on your original amortization schedule, or when you reach the midpoint of your loan term, provided you're current on payments. You can review your loan documents or contact Wells Fargo to find your projected PMI termination date.
How to Make Extra Payments Towards My Principal with Wells Fargo?
You can typically make extra principal payments through your Wells Fargo online mortgage account, by phone, or by mail. When making a payment, ensure you clearly specify that the additional amount should be applied to your principal balance to accelerate your equity build-up.
How to Request a New Home Appraisal from Wells Fargo?
To request a new appraisal for PMI removal, contact Wells Fargo's mortgage customer service. They will guide you through the process, which usually involves ordering an appraisal from an appraiser they approve or recommend. Be prepared to pay for the appraisal fee.
How to Know if My Home's Value Has Increased Enough to Remove PMI?
You can get a general idea of your home's value through online tools like Zillow or by looking at recent comparable sales in your neighborhood. However, for official PMI removal, Wells Fargo will require a formal appraisal.
How to Refinance My Wells Fargo Mortgage to Eliminate PMI?
To refinance with Wells Fargo to eliminate PMI, you'll need to apply for a new mortgage. Contact a Wells Fargo mortgage consultant to discuss your options, assess your eligibility, and understand the closing costs involved. If your new loan's LTV is 80% or less, PMI will not be required.
How to Contact Wells Fargo Mortgage Customer Service?
You can typically reach Wells Fargo Mortgage Customer Service at 1-866-234-8271. Their hours are generally Monday-Friday, 7:00 am - 10:00 pm CT, and Saturday, 8:00 am - 2:00 pm CT. Always verify the current contact information on the Wells Fargo website.
How to Confirm PMI Has Been Removed from My Mortgage?
After you've initiated the PMI removal process, keep an eye on your monthly mortgage statements. The PMI charge should no longer appear on your statement once it's been successfully removed. You can also call Wells Fargo to confirm.
How to Avoid Paying PMI in the First Place?
To avoid PMI from the beginning, you generally need to make a down payment of at least 20% of the home's purchase price when you take out a conventional mortgage.
How to Handle Issues if Wells Fargo Denies My PMI Removal Request?
If Wells Fargo denies your PMI removal request, ask for a clear explanation of the reason for the denial. Review your loan documents and the Homeowners Protection Act (HPA) to understand your rights. You can also contact a housing counselor or legal aid for assistance if you believe the denial is unwarranted.
