Consumer complaint received 2023-02-21
Company: WELLS FARGO & COMPANY
State: VA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process

Complaint:
In XXXX I started a new job, relocated, and secured a home mortgage with Wells Fargo ( WF ). I was thrilled that for the first time in my life ( in my XXXX ) that I was paid bi-weekly by my employer. I knew in setting up automatic bi-weekly payments that this one action would have multiple and significant financial benefits including : 1 ) paying bi-weekly would reduce the term of my mortgage at a swifter rate ; and 2 ) I would be making an extra full payment each year.

Upon review of my mortgage statements, I discovered that my bi-weekly payments were not being applied to my loan directly upon withdrawal from my WF checking account. Upon this discovery I visited a Wells Fargo bank and requested that my bi-weekly payments be applied to my loan immediately upon withdrawal every two weeks. The banking representative made some adjustments to my account, and he conveyed to me that he had accommodated my request. A few months later upon review of my statements, I realized that no changes had been made and that my bi-weekly payments were not being applied to my mortgage until one time at the end of the month.

When I inquired into this issue again with WF, I was told that this was Wells Fargos policy and that they did not have the mechanism to apply bi-weekly funds to mortgages immediately. They explained they were only set up to put the first bi-weekly payment into a bucket, and only upon receipt of the second bi-weekly payment that the full payment is applied to the mortgage. They placated me saying I should be happy that I am making an extra payment each year and that I am reducing the term of my loan significantly. I expressed that I was not happy with their policy and found it ludicrous that in todays technological age that they hid behind this excuse. I vowed to myself to refinance with another institution to get out from under Wells Fargos greedy and unethical practices. 

In XXXX, I selected a smaller Virginia bank ( XXXXXXXX XXXX  ) to refinance my mortgage thinking I was getting out from under the mega-bank establishment. Little did I know it wouldnt play out that way even though I explicitly told my Mortgage Loan Officer that I was refinancing with XXXXXXXX XXXX  so my payments would be applied to my mortgage on a bi-weekly basis and to remove my association with Wells Fargos unethical practices. He unequivocally told me that he would write a note in my account to which I expressed gratefulness as I felt great relief. Unfortunately, he was not forthcoming with me at that time that XXXXXXXX XXXX would not be servicing my loan, however, instead would sell it to another institution. In hindsight he likely knew that I would have taken my business elsewhere, such as to the small, local bank around the corner. 

My XXXX refinance process went smoothly, and I set up automatic payments for my new mortgage under XXXXXXXX XXXX  XXXX A few months later, to my surprise and shock, I received notification in the mail that XXXXXXXX XXXX  had sold my mortgage to XXXX XXXX and that it would be serviced by Wells Fargo. I immediately contacted my Mortgage Loan Officer and he relayed that he had forgotten to write a note referencing my concerns about Wells Fargo, and that unfortunately there was nothing he could do about it. So once again, I was subjected to Wells Fargos unscrupulous practices. 

I have conducted additional research on this topic. I have contacted several mortgage lenders who verified that they immediately apply bi-weekly mortgage payments to their clients mortgages upon receipt. I have discussed this with numerous real estate investors and financial-savvy friends, who said that their bi-weekly payments are directly applied to their mortgages. It is evident that Wells Fargo is an outlier on this practice. The lenders and friends/colleagues with whom I discussed this topic were astounded with Wells Fargos policies and audacious greed. 

I contacted Wells Fargo again recently and verified that WF continues to manage my mortgage as described above. I was told again that WF did not have the capacity to apply my bi-weekly payments to my loan directly upon receipt. I was told by one WF representative that once the full payment is received that it takes WF approximately 24 hours to apply the funds to the different components of my account ( i.e., principle, interest, and escrow ). I asked why this could not be done upon receipt of the initial bi-weekly payment, to which he replied that WF could easily employ that practice if they chose to do so, but currently it wasnt their policy. 

I am fortunate to have found out about the XXXXXXXX XXXX XXXX XXXX ( XXXX ) and it is my hope that the XXXX can assist me with this matter. I ask that XXXX assist with the facilitation of the desired actions elaborated on below. I ask for assistance getting Wells Fargo to retroactively evaluate both Mortgages ( XXXX and XXXX ) and recalculate the balances based on applying the bi-weekly payments to the loan at time of receipt ( 26 times per year rather than 13 times per year ). 

Thank you for your assistance in this matter. Please let me know if I can provide you with any additional information.

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