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A homeowner alleges in a class action lawsuit that Wells Fargo wrongly denies mortgage modifications, leading to foreclosures.
Lead plaintiff Alicia Hernandez claims in her class action lawsuit that she and other Wells Fargo mortgage holders lost their homes to foreclosure after the bank unfairly denied their applications for mortgage modifications.
Hernandez contends that Wells Fargo did this in violation of the Home Affordable Modification Program (HAMP), enacted in the aftermath of the Great Recession of 2008 that left millions underwater on their mortgages.
“Wells Fargo accepted up to $6.4 billion in HAMP funding, but failed to fulfill its obligations and duties to its customers under HAMP’s loan modification program,” the Wells Fargo class action states.
The plaintiff says that she lost her home due to Wells Fargo’s errors in processing her application for a mortgage modification.
“Plaintiff Alicia Hernandez was the exact type of person whom HAMP was supposed to help. Prior to 2008, she was working full-time and bought a condo in North Bergen, New Jersey,” states the Wells Fargo class action lawsuit.
“When the recession hit, however, she lost her job to downsizing and needed the help that HAMP was supposed to provide. Rather than extend a HAMP modification, Wells Fargo miscalculated and initiated foreclosure proceedings. Ms. Hernandez fought foreclosure pro se for years, but in the end, she was foreclosed on.”
According to the Wells Fargo class action lawsuit, the bank developed its own software for verifying borrower eligibility for the program, despite the availability of a federal tool.
As a result of errors in Wells Fargo’s tool, the bank improperly foreclosed on hundreds of homeowners, the plaintiff claims.
“Losing your home through a foreclosure is one of the most disruptive events that you could experience,” points out the plaintiff in the Wells Fargo class action lawsuit.
“Wells Fargo now admits that this tool caused systematic miscalculations that led to Wells Fargo wrongfully denying loan modifications to over 870 borrowers who qualified for a loan modification under HAMP,” continues the Wells Fargo class action.
“Of those, Wells Fargo admits it foreclosed on 545 borrowers when it should have instead offered them a loan modification.”
Mortgage modifications can help take pressure of homeowners facing unexpected financial instability due to job loss, medical, or other expenses.
According to the Wells Fargo mortgage class action, mortgage modifications can substantially reduce mortgage payments – allowing people to stay in their homes.
The Wells Fargo class action lawsuit says the bank, as a part of its campaign to win back consumers after a number of scandals, admitted its tool miscalculated mortgage modification applications.
Hernandez says that the bank sent her a check for $15,000 to “make things right.”
This amount, however, does not nearly amount to “full and fair compensation” for the loss of her home to Wells Fargo’s faulty calculations, alleges the Wells Fargo foreclosure class action lawsuit.
The Wells Fargo class action lawsuit seeks to represent a Class of homeowners who lost their homes after the bank miscalculated and denied their mortgage modification applications.
The plaintiff contends that there are at least 870 Wells Fargo mortgage holders eligible for the proposed Class.
The plaintiff is seeking damages for herself and Class Members.
Hernandez is represented by Michael L. Schrag and Joshua J. Bloomfield of Gibbs Law Group LLP and Richard M. Paul III and Ashlea G. Schwarz of Paul LLP.
The Wells Fargo Mortgage Modification Class Action Lawsuit is Hernandez v. Wells Fargo Bank NA, Case No. 3:18-cv-07354, in the U.S. District Court for the Northern District of California.
UPDATE: On Jan. 29, 2020, a federal judge in California certified a national Class of Wells Fargo mortgage customers who claim the bank denied them mortgage modifications, despite meeting the requirements for the Home Affordable Modification Program (HAMP.)
UPDATE 2: On March 19, 2020, a judge rejected Wells Fargo’s effort to stay a class action lawsuit, saying the bank did not notify some borrowers about mortgage modification options.
UPDATE 3: May 2020, the Wells Fargo mortgage class action settlement is now open. Click here to file a claim.
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58 thoughts onWells Fargo Class Action Says Mortgage Modification Unfairly Denied
We have applied 3 times for modification and each time the mortgage amount was reduced by $2.. I sent letters to CEO..THE WORKS..HELPPPPP
My husband and I applied for a loan modification with the help of attorney Angelo Bagnara and Matt Kiernan.
We were unjustly denied 3 times after applying with proof of income and financial hardships. ( daughter with medical conditions- fell behind on medical bills)
we were able to show the hardship as well as prove viable income to get back on track with a loan modification
after much back and forth in which we have a very extensive files our home was put into foreclosure with a sale date of 5/10/2019.
We nearly lost our 2 family home, but by the grace of God we had to take out an additional personal loan from a friend with a 12 percent interest rent in order to reinstate with all of the money owed up front.
This saved our home. However it has put such a financial burden on us as we continue to struggle to stay in our home and pay our bills to this day.
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please add me to the class action suit. I also lost my home>
It is a hidden fact that mods were denied because as Wells stated to me ..” mortgages in rmbs are not eligible for HAMP modification”…who knew we were IN an rmbs until they came forwtto foreclose AFTER paying their plans and ultimate denial???
The statement is in writing
I also lost my home to foreclosure. This was after I had sent a lump sum that they said was needed to save me from foreclosure. Please add me to this lawsuit.
Wells Fargo would not work with me in 2005 am I to late to file a suit?
Please add me, I lost my house thanks to them
Please add me Wells Fargo also forclosed on me in
after I became disabled refused to do a modification and I talked to Hsmp and I was qualified but
Wells Fargo refused. Thanks alot Wells Fargo and al also never been contacted about this class action never recieved a dime from them .It was a FHA .
The property is in Msple Grove ,Mn
I have not bad a permanent home since having g to couch hop from friends and family still to this day.
I went through all the modification processing that was necessary and came home with court papers taped to my door.
Is this lawsuit only for homeowners in California, I experienced this wrongful foreclosure in Georgia. This is a brief summary…I had been in my home for 15 years. I asked for a forbearance or modification and was told I did not qualify.,, I explained my situation to the first rep and she was very nice and told me I qualified for the forbearance and will start the process. Later the call was taken over by a very rude rep. He told me I didn’t qualify And he also denied the modification. My family had already been dealing with death, separation (my husband left) , loss of employment etc. Wells Fargo started the Foreclosure process then told me if I leave the property clean they would give me a check for $3,500. I asked instead of giving me that money could the apply that to the $4,600 owed so that we could keep my home. The answer was no. They were willing to pay me to leave but not willing to help me save my home.