Consumer complaint received 2025-02-12 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Struggling to pay mortgage — An existing modification, forbearance plan, short sale, or other loss mitigation relief
Company: WELLS FARGO & COMPANY
State: GA

Complaint narrative:
As of today's date, I have not heard from Wells Fargo regarding if I'm impacted by the CFPB settlement. From XXXX XXXX XXXX I attempted XXXX loan modifications and was declined/denial every time followed by XXXX foreclosure notifications.   foreclosure and bankruptcy financially have ruined my credit. I'm seeking recovery of all damages available under the law including compensatory and punitive damages as well as attorney fees and costs. HAMP required mortgage Wells Fargo the mortgage servicer to offer loan modifications to borrowers who met certain threshold requirements. These modifications would lower a borrowers mortgage payments to a manageable 
level (typically XXXX  percent of the borrowers monthly income) and allow the borrower to avoid foreclosure. Unfortunately, this did not happen. However, Wells Fargo, because of an alleged faulty calculation failed to offer a loan modification. Instead, Wells Fargo needlessly tried to foreclose on my Home. Wells Fargo has attempted to cast its conduct here as resulting from a faulty calculation. However, Wells Fargos problem goes much deeper than a single miscalculation. Wells Fargos conduct here reflects the same type of extreme and outrageous conduct that has embroiled Wells Fargo in a string of public scandals. This software determined customers eligibility for a 
government-mandated mortgage modification during a time of extreme financial distress. Its importance to these customers lives cannot be overstated. Yet Wells Fargo not only failed to verify that its software was correctly calculating whether customers met threshold requirements for a mortgage modification, it also failed to regularly and properly audit the software for compliance with government requirements - allowing life-changing errors to remain uncorrected for years on end.

Wells Fargo Admits Loan Modification Error, Wrongfully Foreclosed on Homes
A quarterly filing with the Securities & Exchange Commission in August XXXX revealed that Wells Fargo made an error in denying mortgage modifications to hundreds of borrowers. The securities filing says that Wells Fargo discovered a calculation error in its automated software for calculating whether a borrower should be offered more favorable loan terms instead of foreclosure. Wells Fargo says the error affected XXXX homes that were in the foreclosure process between XX/XX/XXXX, and XX/XX/XXXX.
In XXXX XXXX Wells Fargo revised its estimate, announcing that the miscalculation affected XXXX homes that were going through foreclosure between XX/XX/XXXX, andXX/XX/XXXX.
As Wells Fargo explains, two federal government programs require Wells Fargo and other lenders to offer loan modifications to keep people in their homes when they are in default, rather than going through the expensive process of foreclosure. Wells Fargo did not comply with this law, it says, due to a software glitch that affected XXXX  mortgages that were in default. Ultimately, XXXX homes were foreclosed on, when a mortgage modification should have been offered, according to Wells Fargos disclosures.
Senators Agree: Wells Fargo Computer Glitch Compensation Program Is Inadequate to Repair Damage from Wrongful Foreclosure
Wells Fargo says it has set aside XXXX million to remediate the wrongful disclosures caused by the software miscalculation. Split amongst the XXXX people, Wells Fargo says it wrongfully foreclosed on, which would amount to only about XXXX per person. But reportedly, the checks Wells Fargo is sending out are lower than that. Wells Fargo is telling people they can go to mediation if they want more money.
Senator XXXX XXXX  said of Wells Fargos remediation plan: Setting aside a few thousand dollars for each of the people affected. Pathetic. According to Senator XXXX who sits on the Senate Banking Committee, Wells Fargos remediation plan does not offer nearly enough to compensate for the devastating ripple effect a foreclosure can have, including the stress and trauma of losing ones home, related health problems, and destroy[ing] peoples credit. Senator XXXX continued:
It is hard to imagine how Wells Fargos estimate of XXXX million for remediation would come close to remunerating impacted customers.

List of Challenges and Issues Ive had with Wells Fargo over the last XXXX  years. Starting from XXXX XXXX XXXX XXXX XXXX XXXX XXXX I entered a XXXX XXXX XXXX XXXX XXXX  This loan was predatory. A predatory loan is a fraudulent and unfair, deceptive, or abusive loan that can trap borrowers in debt. Predatory lenders often target people who are in financial need. 
Due to the nature of the pick-a-payment loan, the monthly payment increased to an amount that I could not pay so I ended up filing for Bankruptcy in XXXX to remain in my home. In XXXX XXXX XXXX fell as a bank due to pick-a-payment loans and was acquired by XXXX In XXXX XXXX  was acquired by Wells Fargo as it also fell due to pick-a-payment loans. In XXXX XXXX XXXX my bankruptcy was discharged, and as such XXXX  issued a 1099c stating my debt had been canceled and that I was no longer responsible for the debt. However, my loan with XXXX was never reaffirmed nor was the lien released. However, the security deed was not updated to reflect any changes to my loan. 

In XXXX I was given a loan modification by XXXX and issued another 1099c also cancellation of debt.  Also, in XXXX  I was given another modification by Wells Fargo but not issued a 1099c. In XXXX I was given another modification but this time I was but into a XXXXyear loan and Wells Fargo updated the security deed to reflect the new loan amount and to show Wells Fargo as the lien holder.    

XXXX  Wells Fargo increased my mortgage to XXXXyear loan. They Modified my mortgages and told me if I dont agree with the XXXX-year term, I will most likely lose my home to foreclosure. 
After signing the XXXX-year loan modification I later found out Wells Fargo added a XXXX mortgage (stealth modification).
As the country tried to crawl out of the last recession, homeowners across America sought mortgage modifications to make their home loans more manageable. However, some homeowners say that Wells Fargo not only modified their loans without asking but that this lower rate added years  perhaps decades  to the terms of their mortgages. Wells Fargo has once again found itself in the middle of a growing scandal, as the bank faces accusations of making unauthorized changes to the mortgage loans held by customers who have entered bankruptcy.
This issue came to light after multiple homeowners sued the bank, claiming it had changed the terms of their mortgages without permission. While its unclear just how many of these modifications Wells Fargo has made, at least seven lawsuits, including one potential class-action complaint, have been filed against the bank.
The class-action lawsuit [PDF], filed in a federal court in North Carolina, accuses the bank of making at least three improper modifications to one couples mortgage beginning in XXXX. The couple filed for XXXX XXXX bankruptcy, which allows people to reorganize their finances while they work toward getting out of debt, in XXXX XXXX. According to the complaint, they were surprised to find in XXXX XXXX that Wells Fargo had filed a stealth modification to their mortgage even though their bankruptcy plan had been approved by the court.
Any modifications to a bankruptcy plan must be approved by the court and those involved in the case. However, in this case, the couple claims they never agreed to allow Wells Fargo to change their loan terms. The filed modification, which was part of a loan modification trial process at Wells Fargo, lowered the couples monthly mortgage payments from XXXX XXXX XXXX.
While paying a few hundred dollars less each month might be nice, buried deep in the terms of the modification was notice that the mortgage had been extended to XXXX years.
Under the couples XXXX XXXX plan, they were to pay their remaining XXXX  mortgage over 14 years, incurring about XXXX in interest charges. With Wells Fargos unauthorized extension, they would pay the remaining mortgage amount over an additional XXXX years, incurring not only the XXXX interest charges already planned, but an additional XXXX XXXX XXXX  depending on interest rates.
To make matters worse, the couple claims the Wells Fargo notice of modification implied that they would lose their home if they did not accept the modification.
By following the steps outlined below, you can begin to restore your mortgage account to good standing, the notice stated. If you fail to take the following steps and continue to miss or make late mortgage payments, you risk further damage to your credit and possibly foreclosure of your home.
The lawsuit claims that the couple should not have been in danger of foreclosure as they had not missed any payments before filing for bankruptcy and had made all planned payments that had come due.
Following the filing of this modification, the couple claims that Wells Fargo filed similar changes with the court in XXXX XXXX XXXX XXXX XXXX, neither of which were approved or requested by the couple.
According to the lawsuit, Wells Fargo may have submitted the modification plans to enrich itself through incentive payments by the U.S. government.
The New York Times reports that some lenders take part in certain programs designed to encourage loan modifications for troubled borrowers. In these cases, the bank can receive up to XXXX from government programs for each loan it adjusts.
Additionally, the lawsuit claims that by modifying the loans for a longer term, Wells Fargo can collect millions of dollars in additional interest and servicing fees.
Allegations found in the North Carolina class-action lawsuit have been detailed in several other complaints against Wells Fargo, the Times reports.
In one case, XXXX XXXX XXXX a Texas lawyer, tells the Times that he first thought Wells Fargo had made a simple clerical error when it came to a clients loan modification. But after looking into the issue he found a pattern of filing false documents with the federal court.
These modifications, he says, wreaked havoc on the customers finances and bankruptcy reorganization. XXXX tells the XXXX that one of his clients, who filed for bankruptcy in XXXX XXXX, received a letter in XXXX from the bank notifying them that they had been approved for a trial loan modification. While the couple didnt approve or request the changes, the bank submitted them to the court.
In this case, the payments were reduced from XXXX XXXX XXXX While the client had a plan in place to repay their loan in XXXX  years, the modification extended that time to 40 years, increasing interest charges by an extra XXXX
A spokesperson for Wells Fargo tells the Times that the bank denies the claims made in the lawsuits, contending that both the borrowers and courts were notified of mortgage modifications properly. As for pushing through modifications without borrower approval, the rep says, We do not finalize a modification without receiving signed documents from the customer and, where required, approval from the bankruptcy court.

XXXX  Wells Fargo Mortgage Servicing Violations
Software Miscalculations: A glitch in the banks automated system incorrectly calculated that certain homeowners did not qualify for mortgage modifications, leading to wrongful foreclosures.
Loan Modification Denial: Wrongfully denying eligible borrowers the opportunity to modify their mortgages, resulting in avoidable defaults and eventual foreclosures.
Failure to Offer Modifications: Banks failed or delayed in offering loan modifications to homeowners who qualified under federal programs, leading to foreclosure even though the borrowers were entitled to more favorable modified loan terms.
Inaccurate Loan Reporting: Erroneously reporting some borrowers as being ineligible for mortgage relief, preventing them from accessing loss mitigation programs that could have saved their homes.
Improper Fees and Interest Rate Miscalculations: Improperly charging fees and miscalculating interest rates on adjustable-rate mortgages have caused significant financial losses for homeowners.
Misapplied Payments: Some homeowners reported that payments intended for mortgage modifications were misapplied, causing confusion and leading to wrongful foreclosure due to perceived defaults.
Failure to Implement Federal Guidelines: Failing to follow federal mortgage relief guidelines that require loan modifications before initiating foreclosure proceedings.

Loss of Mortgage Documentation: Errors in internal systems caused the loss of critical loan documents, which resulted in homeowners being wrongfully denied mortgage modifications.

Inadequate Communication: Poor communication practices from banks led to homeowners missing crucial modification deadlines, ultimately resulting in foreclosure even though they were eligible for assistance.

Negligence in Monitoring Errors: Even after discovering errors that caused wrongful modification denials, banks failed to act promptly to rectify the issue, prolonging the harm to homeowners.

Failing to honor your forbearance agreement.
Foreclosing earlier than allowed by recent federal protections put in place due to the COVID-19 pandemic.
Engaging in practices that violate the 1968 Truth in Lending Act (TILA)
Failing to comply with your loan modification agreement; and/or
Failing to give you timely notices you are entitled to receive under federal and state law, such as a notice of default, or a pre-foreclosure breach notice.

4-	Ive received two checks from Wells Fargo
Why is Wells Fargo Sending Settlement Checks Now?
While the exact reason Wells Fargo is sending out these settlement checks remains unclear, the bank has likely uncovered a major servicing violation, like the issues outlined above. These violations may have occurred over several years before being discovered. Given the severity of these errorspotentially leading to homeowners losing their properties through foreclosureWells Fargo is likely issuing these checks as a preemptive effort to settle legal claims before they escalate into more costly lawsuits in the future.
How Big Are the Settlement Checks from Wells Fargo?
Based on clients lawsuits, the settlement checks typically range from XXXX XXXX XXXX  with higher amounts indicating more serious violations. If you receive a very large, unsolicited settlement check in the mail, this could be a sign that your case is particularly strong, making it essential to consult with an attorney. 

5-	Issues highlighting the challenges I have faced when seeking loan modifications with Wells Fargo. Wells Fargo loan modification problems include:
Denial of Loan Modifications: Many borrowers report being denied loan modifications, often without clear reasons.
Document Submission Issues: Borrowers frequently have to send in the same document multiple times, leading to frustration.
Confusion About the Process: Many homeowners feel uncertain about the status of their applications and the overall process.
Negligence in Handling Applications: There have been claims that Wells Fargo acted negligently in denying modifications to eligible borrowers.
Widespread Mismanagement: Reports indicate that Wells Fargo has made errors that resulted in the wrongful denial of loan modifications and other issues affecting mortgage customers.

6-	Harm Done by Wells Fargo Loan Modification Error, Wrongfully Foreclosure 
a.	Severe Emotional Distress XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX	Wrongfully attempted Foreclosure XXXX times XXXX XXXX XXXX XXXX XXXX XXXX.	Hired 3rd party agencies to assist with modification and to stop or avoid foreclosure XXXX XXXX  Had to liquidate retirement accounts to avoid wrong foreclosures. This involved an additional 10% tax due to hardship early withdrawal of 401k XXXX XXXX  Borrowed money from family members XXXX XXXX	Entitled to punitive damages XXXX   

Wells Fargo Unlawful Reporting  Pain & Suffering
Item	Amount
Money paid to reinstate loan XXXX over 9-year period 
Money was paid to attorneys/agencies to help stop multiple foreclosure attempts over 9 years.	Approx. XXXX XXXX XXXX  
Liquidation of multiple 401k	Lost saving/retirement funds = approx. XXXX XXXX XXXX 
Time spent for management of this issue  XXXX  hrs/year	Approx XXXX  IRS confiscation of all tax refunds since XXXX	Approx. XXXX XXXX  per year for XXXX years) 
IRS enforced maximum withholdings  single filer status	
Approx. XXXX XXXX  per year.) 
IRS	XXXX  IRS debt XXXX
Medical conditions due to stress:
During the past 9 years, we have been under hardship and undue stress leading to the following medical conditions: XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX  
Amount - XXXX
Mortgage paid over 9 years totaling over $300,000
Damaged Credit  I have filed XXXX XXXXtime to stop foreclosure since XXXX which now prevents me from getting a loan.
Unable to get loans
XXXX  
There have been several lawsuits filed against Wells Fargo ranging from XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX which have been very similar situations to my situation. Therefore, Im seeking XXXX XXXX XXXX  
Above is a list of activities and damage that have severely impacted me and my family due to Predatory lending, reporting 1099c by Wells Fargo, formerly known as XXXX.  Wrongful foreclosure attempts, Loan Modification Errors, ETC. These problems have negatively impacted our quality of daily life (i.e., no vacations, no dinners out, no shopping, etc.) and damaged our credit. This psychological trauma/mental health, stressful event needs to end. After XXXX  years of being on this mortgage, it is still unclear if my mortgage is valid. XXXX XXXX and Now Wells Fargo have all failed me as a borrower. I was given a predatory loan that is a fraudulent, unfair deceptive, or abusive loan that can trap borrowers in debt. After several government bailouts to these mortgage companies, Im trapped in debt that appears no way out but foreclosure. 

What is Wrongful Foreclosure Action
A wrongful foreclosure is when a lending institution forecloses on a property without any proper legal basis.  This can be through mistakes, negligence or intentional misconduct.  However, it goes, borrowers should always exercise due diligence making sure they dont fall prey to such practices.  
When Your Rights Are Violated
Lending institutions stand to profit by foreclosing on a property.  It may be done by mistake or by unfair means for financial gain.  Whether accidental or deliberate, wrongful foreclosures have huge ramifications for homeowners.  Families can lose their homes, and their credit is so badly impacted by foreclosure that getting a new mortgage is next to impossible, to say nothing of how bad credit can impact other areas of life.  Wrongful foreclosures also cause undue stress on a family, especially if they must completely rearrange their lives (new neighborhoods/cities/schools / etc.).  Many homeowners may decide to pursue legal action against lenders, to reclaim some semblance of their former lives.
Wrongful Foreclosure Cases
There are several high-profile cases to illustrate what happens when wrongful foreclosures happen.  One of the most well-known cases involves Wells Fargo.  In 2019, Washington DCs Eastern U.S. District Court ruled that Wells Fargo wrongfully took back hundreds of homes.  It wasnt deliberate on Wells Fargos part, but a textbook example of a technical glitch in software that caused hundreds of borrowers not to get the loan modifications they qualified for.  As part of the judiciary relief, Wells Fargo gave each borrower more than $10,000.  Victims also had further recourse under a class action settlement with the bank.
In another case, a lending institution told a couple they couldnt get a loan modification without getting behind on payments.  They defaulted on their loan and filed for bankruptcy on the advice of the lender.  They lost their home anyway because the lender continued with foreclosure proceedings, even with a bankruptcy stay in place.  The couple eventually were awarded more than $45 million in actual and punitive wrongful foreclosure damages and court costs.

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