Consumer complaint received 2023-01-02
Company: WELLS FARGO & COMPANY
State: NY
Product: Mortgage
Sub-product: FHA mortgage
Issue: Struggling to pay mortgage

Complaint:
the Homeowners Assistance Fund : Its purpose : to mitigate financial hardships associated with the Coronavirus Pandemic by providing XXXX XXXX dollars, in part, for the purpose of preventing homeowner mortgage delinquencies and ultimately, as in my case, avoiding foreclosure. I researched the American Rescue Plan Act and I have read the Overview of Treasury Guidance, it states that HAF funds may be used to assist homeowners who are at risk of foreclosure and / or displacement. I read the NYS HAF program proposal to the Treasury from Homes and Community Renewal ( HCR ) in which stated funds can be used for Mortgage Reinstatement / Principal Reduction Program or the Arrears satisfaction Program. I continued to read the proposal from XXXX to the treasury. After reading XXXX proposal to the Treasury, I felt I met all the eligibility criteria needed that the XXXX wrote in their proposal to the Treasury. The Homeowners Assistance Fund was approved by the Treasury and the program was set into place and ready to launch. I followed Governor XXXX XXXX updates before the announcement that the portal to apply would be opening in XX/XX/XXXX. The portal opened on XX/XX/XXXX. I submitted my application on opening day at XXXX. 
On XX/XX/XXXX, 11 months after my application was submitted, I was advised that I was ineligible for assistance from the program. My hopes shattered and I fell apart. 
Nearly every other week, if not every week over the past 11 months, I called to check the status of my application and to see if anything was needed and most of the time I was told the file was being worked on and that the case manager was in talks with the bank. I was never given any information or details on how the program was in talks with the bank and I was not advised on or included in any talks. A few times I was told to send in updated statements. I sent in whatever was required. 
On XX/XX/XXXX, I received a message from a case manager, through the HAF portal, stating that based on the program 's review, I meet the basic eligibility requirements for the program and that I was conditionally approved. 
On XX/XX/XXXX I received a second message through the HAF Portal.It was a copy of a letter that was sent to Wells Fargo. The letter was titled : New York State Homeowner Assistance Fund Notice To Servicer of HAF Application. The letter served notice that I was deemed Eligible by the program and will be reviewed for loss mitigation. 
When I spoke with a housing counselor, I asked how the mitigation process works and how the funds would be applied in conjunction with the FHA Covid-19 Recovery Modification, considering now I was deemed eligible to receive an award. I could not get any clarification and was told that the file was with the Attorney General 's Office who was confirming the total amount owed. 
I called the Program to ask to speak to the person who is mitigating and negotiating directly with the bank, because I feel I should be included in the process and advised of how the loan was being mitigated and how the funds were being applied /supplemented in conjunction with the modification. I was told that there was no one I could directly speak to and I can only speak to case managers/ whoever answered my phone call at the time. 
I don't believe I was ever reviewed for loss mitigation and the funds were never even factored into a loss mitigation option particularly FHAs Covid-19 recovery modification and the file was never even negotiated with the bank because if this was the case then a modification would have been worked up to include the {$95000.00} coming to the result of an affordable monthly payment. Reason I feel this way is that Wells Fargo had sent me modification offers over the past year that did not apply the formula from FHAs mortgagee letter XXXX and instead they sent me their streamlined version of a modification. If these offers had been done in accordance to the rules for FHAs Covid-19 Recovery Modification and had applied the award amount from the program, I am certain that I would be offered an affordable monthly payment and therefore avoid foreclosure. 
Since the forbearance period ended, Wells Fargo had been sending me proposals for modifications. I called HAF to explain this and asked if I should accept one of the several modification packets, even though I couldn't afford the offered payment. The case managers didn't know what to say and could not give any guidance. I did not know how to proceed, nor on whether if I accepted one of the modifications, would it affect me being granted an award with HAF. Since I could not afford the offered payment from Wells Fargo without supplementing it with the assistance from the program, I did not accept any offers. 
I was then advised by a case manager that wells Fargo told HAF i failed to make payments for a trial payment plan ( not sure which XXXX they are talking about because there were a few mods offered ) on a modification, and this is also where there is discrepancy and confusion because any modifications that were offered were not signed and therefore no trial payments were even supposed to be made. I found out all these concerning discrepancies, only after I had been denied assistance and having to call multiple times in a couple of days to get some sort of clarification and understanding as to why I am being denied. So now here I am with several different explanations that are not even applicable or valid to issue me a denial. 
I had discussed with case managers that if the program advised the bank to apply FHAs Covid-19 Recovery Modification ( and review the modification to make sure it was applied correctly ) in conjunction with the award of {$95000.00}, that I would achieve an affordable payment. My understanding is that one of the purposes of the HAF program is to supplement a loan modification with the funds to achieve an affordable monthly mortgage payment. In my case ; the full award amount would be used together with the XXXX Recovery Modification waterfall, to reach the targeted monthly payment. FHAs Mortgage Letter XXXX : update to the loss mitigation options ; dated XX/XX/XXXX states specific directive on how to apply the covid recovery XXXX. Under directive by FHA, HUD, the Treasury of The Office of Inspector General, The Consumer Financial Protection Bureau, Department of Financial Services and the Attorney General 's Office, banks are to apply this modification and if needed to avoid foreclosure, to use this modification in conjunction with the HAF Fund to achieve an affordable monthly mortgage payment and avoid foreclosure. 
The denial email states that to receive mortgage reinstatement assistance, the homeowner must have a delinquent mortgage that may be brought current without exceeding the maximum award amount of {$95000.00}. 
The bank had not applied the XXXX Recovery Loss Mitigation Option as outlined in detail by XXXX mortgage letter to be applied to the loan. If the bank and the HAF program had worked together and applied the Covid-19 Recovery Modification supplementing it with the {$95000.00} assistance, I would be given an affordable monthly mortgage payment. 
When I spoke to another case manager I was told the reason that I was ineligible was because the loan exceeds {$200000.00} in arrears. However, I respectfully disagree with this decision because when I submitted my application on XX/XX/XXXX, I was under {$200000.00} in arrears. Additionally, I continuously throughout the program remained under {$200000.00} in arrears up until XXXX, XXXX. I have attached statements dated XX/XX/XXXX and XX/XX/XXXX showing my arrears to be under {$200000.00} for when I submitted my application to the program on XX/XX/XXXX as well as my XXXX statement showing I continuously remained under {$200000.00} in arrears up until XXXX, XXXX. According to the HAF policy manual, nowhere does it state any specific rules that if the arrears goes over {$200000.00} one month before a decision is made, that the applicant is ineligible for an award. 
My application status on HAFs website states : Ineligible - No reasonable home retention offer. 
I disagree with this conclusion because as previously stated if HAF and the bank had followed the Covid-19 Recovery modification - ( Please see FHAs attached mortgage letter ) in conjunction with the {$95000.00}, there would be a reasonable home retention offer. 
I called again to express my concern and to try to get more understanding of how the ineligibility was decided. I was advised by another case manager ( 3rd different one ) that the reason for the denial was that I failed to make trial payments under the modification Wells Fargo had offered me. Which modification are they talking about and why would this even matter as FHA specifically states NO Trial Payment plan ( TPP ) is required under the COVID-19 Recovery modification, therefore proving that Wells Fargo had not followed FHA directive and also the Attorney General 's Office department representing HAF and its applicants did not oversee Wells fargo 's intentional misconduct therefore causing me to be ineligible for assistance. How is this possible? 
Another discrepancy that I was told by a case manager is that the bank advised HAF that they had applied the funds to the modification that they offered me. This is untrue and completely false, as I have received several modifications from the bank starting in XXXX and not one of those modifications had any mention of HAF funds being applied to the modification. The Mods break down the specifics and this was not the case. ( I have attached the mods ). The bank would have clearly written in the modification packet that the funds were applied if this was true. Also, the bank would not just apply {$95000.00} to a modification, if the funds werent available in their account and sent to them first. ( i have attached a few of the modifications that were sent to me showing that I could be granted an affordable monthly payment and a reasonable retention offer if the funds were applied to the correct way to the COVID-19 Recovery modification ) A case manager said the bank applied the funds to the modification ( which is not true ) But then later on in the call he stated they would be applied if I accepted a modification. I proceeded to tell him that I could not afford the proposed modification from the bank and that I didn't accept the modification. The reason being was because in the fine print at the end of the modification offer, if I was to accept it, I forgo any future assistance from them or any other source. I called HAF several times at the time the modification was offered explaining my confusion and concern and I was not given any instruction on how to proceed. I did not know what to do at the time. I have been sent several modifications from Wells Fargo and have had no help whatsoever in regards to how to proceed. 

In addition to all of the previous matters that I mentioned, the bank did not follow FHAs Covid-19 Recovery Modification Waterfall as advised and directed to follow. The program did not direct the bank and did oversee to make sure the bank used the {$95000.00} assistance and applied it to the recovery modification, therefore making me ineligible for assistance. 
There are discrepancies along the communication lines and I am being advised different reasons why I am ineligible to receive funds that the government has specifically stated to be used in cases like mine. I have shown that I am eligible to receive this assistance. It is unfair that I am being denied this when the government intended the funds be used in cases like my own. I have the dire need and I am XXXX. In a time like this I am desperately relying on and need this help. this assistance is detrimental to me having to keep my home. I express each time I call that I have been in court since XXXX and that the Judge is moving quickly and I am about to be foreclosed on. I have to return to court in XXXX, to tell the Judge I was denied and filed an appeal to the program, which I received notice that it was denied XX/XX/XXXX and the reason states " We are unable to bring your account current. To be eligible for assistance with your delinquent payments, NYS HAF must be able to bring your account current without exceeding the maximum award of {$95000.00}. Unfortunately, we can not bring your account current without exceeding the maximum award amount. '' The appeal is due today, I will submit it this very last day because I have been in the hospital since XXXX morning up until XX/XX/XXXX. I was so very ill a week before being rushed to the hospital by ambulance. I did not have the functioning capacity to check my email from the program, and with only 10 days to submit an appeal after the date they send the denial email, leaves me struggling to appeal. I turn to you for help in assisting me in achieving answers and a resolution to this matter. I appreciate your assistance. 


Sincerely, XXXX XXXX

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation