Wells Fargo home loan customers who have lost their homes are eligible for an $ 18.5 million settlement that, if approved by the court, will end a class action related to banking errors that led mortgage holders to lose the house due to the pre-closure.

Holders of a Wells Fargo loan can take advantage of the agreement if, between 2010 and 2018, they meet the following criteria:

Qualified for a government-sponsored loan modification or payment plan through Fannie Mae or Freddie Mac, the Federal Housing Administration, or the Affordable Housing Modification Program;

They were not offered a mortgage loan payment modification or loan because Wells Fargo considered the legal fees to be excessive;

As a result, Wells Fargo sold its home on closing.

A woman claims the bank incorrectly rejected her application for a mortgage modification in 2018 and her home sold at closing as a result.

The plaintiff accused the bank of withdrawing money from a government program and failing to pass that benefit on to Wells Fargo loan holders as required by the terms of that program.

The class-action lawsuit alleged that government programs were started to help keep mortgage holders in their homes despite a disruptive event, such as job loss or medical bills. Programs offered by the federal government help keep people in their homes by reducing mortgage payments.

For legal reasons, Wells Fargo devised its tool to calculate whether applicants for loans or payment changes were eligible under various government programs. The tool was flawed, you claimed a class-action lawsuit, and it was developed despite a suitable tool offered by the federal government.

Wells Fargo’s class-action lawsuit alleges that the bank has wrongfully defaulted on more than 500 Wells Fargo home loan owners.

Wells Fargo’s class-action lawsuit found that the bank had admitted the instrument was defective and had mistakenly rejected the mortgage modification and incorrect payment requests.

The plaintiff allegedly received a check from the bank for $ 15,000 to “fix things” after losing her home to one of those mistakes.

The plaintiff said Wells Fargo’s actions were not enough to address the damage caused to hundreds of homeowners who lost their residences due to the alleged errors.

In 2020, Wells Fargo asked the court to stay the class action but lost its offer for the stay. The judge ruled that the bank did not show that the plaintiff had not been able to establish his causal relationship and his damage.

Additionally, the judge disagreed with Wells Fargo’s argument that it would suffer material financial harm if the class action were allowed to continue.

Wells Fargo eventually denied the class action charges but agreed to pay $ 18.5 million to settle the dispute.

Under the terms of the settlement agreement, class members will automatically participate in the transaction and receive a fee of $ 13.575 million.

The award of each class member will be based on the outstanding balance of the mortgage at the time of the alleged Wells Fargo error, if they were in arrears on the loan for more than six months at that time and the amount of the check previously presented to the class. . Member when Wells Fargo admitted his mistake.

Additionally, class members can file a claim based on the severe emotional distress they suffered as a result of losing their home to foreclosure. Class members who can demonstrate that they have suffered severe emotional distress will share $ 1 million in the settlement fund.

Class members who wish to file a complaint based on their serious emotional distress can submit a complaint form by email or online. Applications must be submitted by July 2, 2020.

The final hearing on the Wells Fargo Home Loan Class Action Settlement is set for August 20, 2020. Collection members who wish to opt-out must have done so by mail, postmarked no later than July 2, 2020.

Who is eligible?

Members of the group include “All persons in the United States who between 2010 and 2018 (i) qualified for a mortgage loan modification or payment plan following the requirements of government-sponsored companies (such as Fannie Mae and Freddie Mac), the Federal Housing Administration (FHA), the U.S. Treasury Department’s Affordable Housing Modification Program (HAMP) (ii) have not been offered a mortgage loan modification or a plan of payment by Wells Fargo because the lawyers’ excessive expenses were included in the loan modification decision process, and (iii) which The Wells Fargo House is sold in foreclosure. “

Potential reward

Class members will automatically receive a portion of a $ 13.575 million settlement fund based on “(1) the amount of their outstanding balance at the time of the error; (2) if at the time of the error; the loan was overdue for six months or more, and (3) how much Wells Fargo previously sent you. “

Class members can also file a claim for serious emotional distress suffered as a result of the closure. These claims will be considered by a court-appointed attorney.

Receipt

Class members will automatically participate in the settlement. Class members who wish to file a claim for extreme emotional distress should submit a complaint form describing the distress they have experienced along with any related professional care they have received.

Gibbs Law Group in Oakland, California, has filed a class-action lawsuit against Wells Fargo Home Mortgage for unfairly denying mortgage modifications to homeowners who need them.

Between September and October 2018, Wells Fargo sent letters to approximately 870 customers who applied for a mortgage modification between April 13, 2010, and April 2018 but were denied a chance. Wells Fargo acknowledged that these owners had been unfairly denied modification due to a “bug” in the software with Wells Fargo’s internal system.

Of the 870 homeowners who were wrongly denied mortgage modification, at least 545 lost their homes as a result.

As founding partner Rick Paul explained, “Wells Fargo must be held responsible for the unnecessary harm and anxiety it has caused to borrowers and their families.”

Wells Fargo also acknowledged that his investigation is incomplete and that more borrowers may be affected.

For the first 870 owners identified by Wells Fargo, he sent a letter explaining the “technical problem” and a check to make up for the mistake. In many, if not all, the amount offered does not fully compensate the homeowner for the unjustified denial of the modification and/or closing of the home mortgage.