If you currently have a mortgage through the San Francisco-based bank Wells Fargo, you should check the status of your loan ASAP to see if it was placed in forbearance without your knowledge. A mortgage that is in forbearance can not only affect your credit options, but also affect your ability to take advantage of current low rates.
In March, Wells Fargo customers began to see a link on their company website regarding Covid-19 that urged those that had been affected by the pandemic to click and provide contact information. What these customers did not realize was that this link was not going to provide them with program information regarding the steps Wells Fargo was taking for its customers during the virus, but instead immediately placed their mortgages into forbearance. Once entered into this forbearance, customers were not permitted to opt out.
Under the CARES Act passed earlier this year, Congress allowed mortgage holders to place their loans into forbearance so payments could be suspended without penalties. The problem is, Wells Fargo customers in 14 states have said that their loans were entered into the forbearance program without their consent, making it impossible to refinance the loan with another bank, which could potentially save them hundreds of dollars a month with the current, historically low interest rates.
Congress has taken notice. Senator Sherrod Brown (D-OH), the ranking Democrat on the Senate Banking Committee, said in a statement to NBC News, “Once again it seems that Wells Fargo sloppy service and shoddy management are hurting consumers. Wells Fargo should immediately address each of these complaints and make changes to ensure that no borrower finds themselves worse off from actions that their servicer takes without their consent or notice.”
In response, Wells Fargo released the following statement to NBC News, “In the spirit of providing assistance, we may have misinterpreted customers’ intentions in a small number of cases…Customers placed in forbearance received notices of that action through multiple channels, and we removed them from forbearance upon their request.”
Wells Fargo customers claim that isn’t true. Tammi Wilson claimed after clicking the Covid-19 link and entering her contact information her account was made inactive only days later when she attempted to log in to make a payment. When she continued to make payments her bank sent her a letter to opt out, but as of July 18 her credit report shows that her mortgage is “in forbearance” and that her April and May payments were not credited to her account, which Wells Fargo disputes. According to Wells Fargo spokesman Tom Goyda, “Any payments made by a customer while in forbearance are applied to their principal, interest, and escrow, when applicable” which he states can be seen on their monthly statements and in their online accounts.
This latest scandal is just one that has plagued Wells Fargo. In 2016, Wells Fargo employees were found to have created approximately 3.5 million fake accounts to receive sales-based incentives. A subsequent scandal was tied to its auto insurance, mortgage, and wealth management divisions that resulted in a change of leadership, charges against former employees, and fines against the company of over $4 billion over the past three years.
Wells Fargo customers are urged to immediately check if their mortgage was placed in forbearance without their knowledge and if it was, contact Wells Fargo to have it removed. If Wells Fargo does not respond or refuses to remove your mortgage from forbearance, consider contacting the consumer law attorneys at America’s Consumer Lawyer.
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