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A judge has rejected Wells Fargo’s effort to stay a class action lawsuit, saying the bank did not notify some borrowers about mortgage modification options.
The bank attempted to pause the claims while a court of appeals heard the bank’s plea that the Class of mortgage borrowers be reconsidered.
The decision to keep the mortgage modification class action lawsuit was made by U.S. District Judge William Alsup in the Northern District of California. The judge decided to deny Wells Fargo’s request for a stay, believing that the bank did not meet its burden to show that a stay was warranted.
The judge based his decision on four essential factors — the likelihood that the appeal would succeed based on merit, harm that would be done to the defendant if a stay were not granted, harm that would be done to plaintiffs if a stay were granted, and general public interest.
Judge Alsup starts his denial decision by noting that Wells Fargo’s premise for why the mortgage class action lawsuit should be paused is based on the same faulty argument that the bank presented during the Class certification period. In both instances, the bank argued that customers had not stated how causation and damages would be proven.
However, the judge determined that this was not enough to pause the claims because this takes issue not with the matters that affect all of the consumers, but with how the Class was defined.
The denial decision goes on to note that Wells Fargo had not sufficiently addressed the issue of the harm or benefits that could result from pausing the mortgage modification notification class action lawsuit. The bank had said that the costs of preparing for trial would cause Wells Fargo significant injury. Judge Alsup rejected this argument because the trial scheduled for May 11 had already been canceled.
The Wells Fargo mortgage denial decision noted that the trial will not be held until Class Members have had the opportunity to opt out of the Class, and until the request for summary judgment has been reviewed.
According to Judge Alsup, there is enough time between then and now for the court of appeals to decide if Wells Fargo’s appeal of the Class certification will be accepted. In sum, the judge determined that Wells Fargo would not be irreparably harmed if the mortgage borrowers’ claims proceed.
Judge Alsup then rejected another one of Wells Fargo’s arguments on a similar basis.
The bank had argued that public interest would indeed be harmed if the mortgage modifications class action lawsuit were denied.
According to the bank, the Class would be confused if they were to receive multiple notices about the litigation.
This argument is moot, says Judge Alsup, because the court already approved the distribution of notices to the Class — if an appeal is granted and the Class is changed or decertified, the Class would receive multiple notices whether or not the stay was granted.
The Wells Fargo mortgage notice class action lawsuit was filed by Alicia Hernandez in 2018 over claims that the bank wrongly denies mortgage borrowers modifications to their loans.
Allegedly, Wells Fargo’s denial of these mortgage modifications violated the Home Affordable Modification Program.
According to Hernandez, the bank took up to $6.4 billion in HAMP funding after the Great Recession of 2008, but did not fulfill its obligation to borrowers under the program.
Hernandez says that she and other customers lost their homes due to foreclosure as the result of this practice. She argues that Wells Fargo incorrectly calculated her mortgage, and initiated foreclosure proceedings. Allegedly, the plaintiff fought the foreclosure for years, but was ultimately unsuccessful.
The Wells Fargo HAMP class action lawsuit notes that Wells Fargo does admit it committed “systematic miscalculations” that led to many customers being denied loan modifications for which they should have been eligible under HAMP. Allegedly, the bank admitted that it had foreclosed on 545 borrowers that should have been eligible for a loan modification.
Are you familiar with the benefits of a HAMP loan modification? Tell us in the comments section below.
The borrowers are represented by Michael L. Schrag, Joshua J. Bloomfield, and Linda P. Lam of Gibbs Law Group LLP and Richard M. Paul III, Ashlea G. Schwartz and Laura C. Fellows of Paul LLP.
The Wells Fargo Mortgage Modifications Notification Class Action Lawsuit is Hernandez, et al. v. Wells Fargo Bank NA, et al., Case No. 3:18-cv-07354, in the U.S. District Court for the Northern District of California.
UPDATE: May 2020, the Wells Fargo mortgage class action settlement is now open. Click here to file a claim.
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15 thoughts onWells Fargo Can’t Pause Mortgage Class Action
Absolutely! They are currently doing that to us. Unfortunately, the guy said it would be better for my husband to file the Modification Paperwork w/o me on it. Even so, he should have been approved. They sent a denial w/o explanation quickly. Then proceeded with the Foreclosure process. There was a paper with it stating if we didn’t agree that we could appeal the decision. That wasn’t true. They didn’t even give us a chance to appeal. (The late payments happened over a time they acquired the loan from another company & we were sending payments to the other company unknowingly. WF claimed they got what pymts we sent the other ppl, but that’s not true. They def didn’t get all of them).
Not only all that, but they had claimed (and still are), that we owe much more than we really did on the past due amt. We were only 2 payments behind in the beginning. We sent proof of payments, they still claimed we were more behind than that. So we tried to make a double payment thru MoneyGram. It was refused by the mortgage company. We tried several times. It got to the point that we thought there was no other choice, but to file for bankruptcy. Unfortunately, we tried it on our own 3 times & 3 times we screwed it up. It’s definitely hard to do on your own. They filed a paper stating we were only using it as a stall tactic & unfortunately the judge agreed. Little did she know, that we really did mess it up on our own & not on purpose. We thought we’d learn from the time before, etc. Apparently, we didn’t. We are now facing fore- closure again. Wells Fargo, claimed we could apply for either a loan modification or repayment plan. They lied to us. Must be part of the training there, “always lie to the customer/ borrower”. We want to save our home, but it is apparently too late. I am too ill to move right now, but will be forced to. Also, had they not lied in the beginning until now abt the amt we were behind, we could have paid the amt we “Really Owed Them”. We had a paper stating the months we were behind (even after they stopped taking payments). Plus, how long they said we were behind, but yet they claimed it was twice, close to three times the amt!!
Heck even months ago, we cld have gotten a small personal loan to pay the amt, we were actually behind, but that is impossible now. They still claim it is almost 3x what we are actually behind. No wonder attorney’s had said from day one, that’s 3 years behind! We were never 3 years behind! Of course now, after 3 attempts at Bankruptcy & so forth, we are probably abt 1 & 1/2 to almost 2 years behind.
Wells Fargo suggested a loan modification to us. Told us not to make monthly payments. After 2 months we received papers that the loan was approved on a Friday. The next Monday a notice that it was withdrawn. Late fees, ruined my credit and they sold the loan to Rushmore LLC. A total disaster. For months we never received papers from them. The new payments used to start in January, they changed it to December. Now we are overpaying fees for tax and insurance! Wells Fargo has made our life unbearable! They should be closed and so should Rushmore LLC.
I worked with Wells Fargo for over 2 years for a mortgage loan modification. I sent them paperwork every 6 weeks for over 2 years. I had six different loan specialists “assisting” me and telling me six different things. Until I went before a judge for a sheriff sale. Wells Fargo foreclosed and then bought my house at the sheriff’s sale.
Wells Fargo’s associates (because after all, there is no “WF,) did very bad things. My house has since been sold. How in the world can this or any settlement provide reparations for this trauma?
I am still looking for some relief. Just let me have my credit report fixed. The last straw for me was hearing that they built there own calculator. NPV was correct, they put lawyer fees in the equation. They pushed the proceeding out, so my wife’s active duty discharge was outside the 11 month. They offered us home preservation team. Within a month the foreclosure picked up steam. Was contacted to participate in the audit of there HAMP process. Sent them all the info including the case no. NO RECORD OF MY LOAN EXISTED. NOW I WAS FORECLOSED BACK IN 2011. I AM GETTING SHAFTED ALL OVER AGAIN. I HAVE A GREAT JOB AND HAVE NOT MISSED A RENT PAYMENT IN 9 YEARS. I AM GOING TO WORK THE REST OF MY LIFE. MY 401K PROBABLY IS GONE IN THIS PAMDAMIC. THAT’S AMERICA, Well that’s a shame, God Bless America!
My mother has been in and out of court since 2007 after a divorce/mortgage transfer, fighting foreclosure with Wells fargo. She has passed in 2016 and I have since been fighting to save my home from Wells fargo foreclosure.
Please contact me
I have paperwork
Phone logs as well as faxing
They said they never got it
I have confirmation
We have sls. no good company contact us
Short and Sweet! Wells Fargo hung us out to dry. Please direct any and all questions to:
Wallace B Christina
274 E Pine Street
Lebanon, OR 97355
Or: 541-570-1160
I have been trying for 10 years to get someone to help us.
Wells Fargo has SLS as a mtge service for my loan. I tried in court for a refi into my name due to divorce, I was denied in Court!