Types of Mortgage provides Wells Fargo
You can buy a house or refinance an existing loan with Wells Fargo. Currently, Wells Fargo Bank has the following mortgage loans:
- 7 years and 6 months ARM jumbo
- 15-year fixed-rate jumbo
- 30-year fixed-rate jumbo
- 7 years and 6 months ARM conventional
- 15-year fixed-rate conventional
- 30-year fixed-rate VA
- 30-year fixed-rate conventional.
If you want to take a loan for a house purchase, the interest rates of these loans vary from 5,000% to 6,000%, while the annual percentage rate (APR) is from 5,559% for a 15-years fixed rate to 6,660% for a 7/6-months ARM.
Refinance interest rates are higher, and there are only four home lending options available:
- A 7/6-month ARM jumbo loan has an interest rate of 5.375% and an APR of 6.275%.
- A 15-year fixed-rate jumbo loan has an interest rate of 5,500% and an APR of 5,682%.
- A 30-year fixed-rate jumbo loan has an interest rate of 5,625% and an APR of 5,745%.
- A 30-year fixed-rate conventional loan has an interest rate of 6,375% and an APR of 6,571%.
Adjustable rate mortgage loans (ARMs) have their interest rates change after some time. For example, your 7/6-month ARM may have a fixed interest for 7 years, but then, for 6 months, it will be changed according to the Prime Rate. This way, your mortgage may cost more over time if the Prime Rate increases.
For mortgage options, Wells Fargo requires a down payment:
- Conventional fixed-rate loans require a 3% down payment.
- FHA loans are available with a 3.5% down payment.
- VA loans come with a low to no down payment.
Pros and cons
Pros
- Many loan options with different terms. Wells Fargo has mortgage loan options for buying a home and refinancing. You can get jumbo, conventional, or government-backed mortgages according to your needs.
- You can pre-qualify for a mortgage. Wells Fargo has an online pre-qualification for borrowers with no credit score check.
- Wells Fargo can help you cover insurance.
Cons
- There are no lines of credit or home equity loans available. Wells Fargo stopped issuing such loans in 2021, so the borrowers looking for HELOCs need to find other lenders.
- Wells Fargo has a history of mismanagement of its mortgages, auto loans, and deposit accounts. It was applying higher payments to their consumer accounts and charged fees illegally.
Main requirements
To determine if you are eligible for the mortgage, Wells Fargo requires you to prove your identity, income, and employment and provide the home value details.
If you are buying a property, you will need to get a property inspection. It is not an appraised value most lenders require.
The bank also requires you to obtain mortgage insurance. You will present an insurance binder and pay for the insurance coverage.
The bank will ask for your personal information, like name, physical address, phone number, and email. You can prove your identity with SSN or a driver's license. Additionally, you will have to provide income and employment documents. The bank will assume your debt-to-income (DTI) ratio to determine if you can pay the home mortgage back.
Your credit score plays an important role in your creditworthiness. The interest rate you will get will depend on your score. Wells Fargo generally requires a FICO score of over 700. The lower your score is, the higher your rate will be.
How to apply for a mortgage?
Wells Fargo allows its customers to apply for mortgages online, in person, or via phone.
To apply in person, you will need a mortgage consultant via your local Wells Fargo branch or via the bank's website. Schedule the appointment and, on the application date, bring the required documents with you.
If you want to start your application online, you need to prepare the documents and only access the Wells Fargo website. If you are already a Wells Fargo customer, some information will be pre-filled.
The online application process is the following:
- Access the bank's main website page;
- Click the "Home Loans" button;
- Choose if you want to get pre-qualified or apply;
- Fill in the mortgage application. You will need to provide your personal details, employment, and financial information, submit the documents regarding your home's value, appraisal, and home ownership documentation, and fill in the loan details by choosing the loan amount and term.
Once you submit the form, you will need to wait for the response. The Wells Fargo representative will contact you to state the decision in 30 to 90 days. If you are approved, you will sign the agreement and can receive the available funds. If you are rejected, Wells Fargo must state the reasons for the rejection in a clear manner.
How to pay off a home loan?
You will receive money in your checking or savings accounts via mailed check or in person. The payment date starts 25-30 days after you receive the funding.
Wells Fargo accepts wire transfers, phone or check payments, and Bill Pay.
- To pay by phone, you need to contact the bank Monday through Friday until 7:30 pm CT.
- For cashier's checks, certified checks, and Bill Pay, you need to mail them drop-off at Wells Fargo Home Mortgage.
To make payments on your home loan, you can opt for automatic or online payments. Automatic payments are debited on a preset day each month. Online payments can be managed through your Wells Fargo account.
You cannot make payments with a credit card. However, you can set up auto payments on your home mortgage to withdraw the payments from your checking account each month.
The funds are applied the same day if the money was received by the deadline for the payment option. If not, the funds will be applied on the next business day. The deadline for wire transfers is 2 pm CT, Monday through Friday. For phone payments, the deadline is 7:30 pm CT, Monday through Friday. For cashier's checks, certified checks, or Bill Pay, the deadline is 5:40 pm CT.
Financial institutions and mailing services can charge fees for wire transfers, Bill Pay, or checks. You will additionally pay closing costs and need to cover other charges, like origination and late payment fees.