Getting rid of PMI (part 3): The I stands for “I already told you”

Part of a series:

• Getting rid of PMI (part 1): The P stands for “parasite”
• Getting rid of PMI (part 2): The M stands for “misdirection”
• Getting rid of PMI (part 3): The I stands for “I already told you”
  
• Getting rid of PMI (part 4): Hard work vs. a risky shortcut
• Getting rid of PMI (part 5): The moment of truth?

Earlier this year, I talked about my attempt to figure out how to remove Private Mortgage Insurance (PMI) from my mortgage. PMI, you may recall, is insurance that you take out against yourself, because your low equity implies to your mortgage servicer that you are a risk for default. So when you have less than 20% equity (80% Loan To Value, or LTV), you are usually required to take out PMI.

PMI isn’t a lot of money, but, as you can probably tell, it makes me angry that I have to pay any amount at all because some company is betting against my repayment.

So since I got my mortgage, I’ve been scheming for a way to remove PMI.

This is the continuation of the story.

Endless customer service

Recall that after a lot of back and forth, I still hadn’t actually figured out what I needed to do to remove PMI. I was trying to get a straight answer, but I couldn’t get anything concrete. And SunTrust always wanted me to send a Secure Message, while they would respond by snail mail, making every back and forth take forever.

But, lacking any other option, I sent a second Secure Message asking what I needed to do to remove PMI. Specifically, the questions I asked were:

* What LTV do I need to have before I can remove PMI?
* How long must I have my mortgage before I can remove PMI?
* Is there a way to remove PMI based on a reappraisal of the property value?

I sent off the message and received a message back saying that they would send me a reply through smail mail in 4-6 weeks. Of course.

I waited impatiently for the answer.

The second letter arrives

Weeks later, when the second letter arrived, I opened it up, and saw…

…the exact same letter I had received before.

The first page described how to remove PMI based on the original sale price. Nothing there about a reappraisal.

Furious, I sent another Secure Message, writing with fire and brimstone about how no one is listening to my actual request, and would you please get a human to get involved with your process or I will investigate some kind of legal action against you.

I’m rarely mean with customer service (I worked in customer service for years, so I have lots of compassion), but this was ridiculous. I had been working on this for two months, and didn’t have any answers yet.

I’m really not much for sending angrygrams, though, so I hesitated on the Send button.

Something in me decided to take one more look at the letter I had been sent. I decided to read every word, slowly, to see if there were any clues in there.

Earthquake pills revisited

Do you remember that Roadrunner cartoon, where Wile E. Coyote tried using earthquake pills on the Roadrunner, and then eats the entire package himself because he believed they were fakes? Do you remember how right as he threw the bottle away he saw with horror that the fine print said “Not effective on Roadrunners”?

Well folks, that’s almost what happened to me. And do you know why?

Because the information I had been seeking, that I had been yelling about not receiving, was in fact there all along.

Um, uh, sorry about that

In my defense, the information was arrayed in a rather confusing way, made out to look like it was a continuation of the first page’s topic.

But there was indeed a section on removing PMI based on the “current” value. And it took me some time to realize that “current” meant the value based on a new appraisal.

So SunTrust and I had been using different naming conventions too.

I’m so glad I never sent that message! I think there’s a lesson in there somewhere.

The information

So here is what SunTrust sent me about removing PMI from my loan based on “Original” Value

[Y]ou have the option of reducing your principal balance by submitting a check in the amount … to equal a loan-to-value ratio of 80%. You must have a good payment history with no payments 60 or more days due within two years, and no payments 30 or more days past dur within one year. This option would allow for the deletion of PMI.

And here is what SunTrust sent me about removing PMI from my loan based on the “Current” (ugh) value (all formatting designed to mimic the original):

To qualify for deletion of PMI, the below guidelines must be met:

• No payment 60 or more days past due within two years
• No payment 30 or more days past dye within one year

Property Age Requirements

• The minimum age requirement of your mortgage loan is 2 years. This may be waived under certain circumstances if improvements have been made to the property that have significantly increased the value. Please provide a list of any improvements made to the property.
• The LTV must be below 80% if the loan is at least 5 years old.
• The LTV must be below 75% on all loans less than 5 years old.
• The LTV must be below 65% if the property is a 2-4 family primary or 1-4 family investment property

(Note that I have no idea if your criteria will be different or not. This is not meant to be a step-by-step guide.)

Now, armed with knowledge, I could finally ask myself the question: What am I going to do now? How am I going to get rid of PMI?

Stay tuned for the next installment of the series.

Have you ever sent an angry customer service message and then regretted it? It’s okay, you can tell us about it.