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Class action lawsuit filed against Wells Fargo for illegal HAMP denial

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Borrowers allegedly misled, defrauded

A new class action lawsuit against Wells Fargo claims that the bank illegally refused to grant permanent loan modifications promised to homeowners who successfully completed a trial mortgage modification under the Home Affordable Modification Program (HAMP). It was discovered that the $75 billion government funded program failed to grant permanent modifications nearly half of the time, which most consider a failure of the program which we have long called a colossal failure.

A new suit, filed in the U.S. District Court for the Northern District of California, has taken Wells Fargo to task for their role in failing to help the homeowners they and the government had promised those who successfully completed the trial would be granted. The suit claims that Wells Fargo violated California’s consumer protection laws by misrepresenting the terms of the HAMP trial period plans as well as breaches of contract.

As part of the plan, the suit alleges that Wells Fargo and borrowers agreed to a reduced mortgage payment for three months as a trial period to prove their ability to pay that new lowered amount, but despite that agreement, homeowners are claiming they were not granted a permanent loan modification, the entire point of the HAMP program.

Anatomy of an allegedly illegal modification denial

According to lawyers representing the plaintiff, Amira Jackmon bought her home in 2005, lost value in her home when the market crashed and was unable to refinance after being laid off. Wells Fargo offered a loan modification if she could make all payments on time under HAMP requirements; they signed the agreement and she made all payments on time and was then instructed to make four more months of payments at that rate. After the trial period ended in 2010, Wells Fargo allegedly told her that her request for a permanent modification was denied and the foreclosure process began. Her home was sold at a trustee sale in May of 2011.

The lawsuit claims the trial program was “a ruse designed to induce consumers into sending payments to Wells Fargo, even when Wells Fargo knew that it had no intention of granting the permanent loan modification it promised.” The suit claims that Wells Fargo misled homeowners to the tune of several million dollars and they are seeking restitution of payments made and they seek to recover all other funds and property lost in connection with the alleged illegal activities of Wells Fargo.

“We will prove in court that Wells Fargo’s operations turned a program designed to help homeowners into a revenue stream for the bank,” the plaintiff’s lawyer said in a statement.

Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.

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29 Comments

29 Comments

  1. Haley

    October 31, 2011 at 7:44 am

    Oh dear, what will they think of next?! This kind of story is why OWS makes so much sense to me…I just hope they get something accomplished out there. They need goals!

  2. denise

    March 18, 2012 at 1:26 am

    I need to know about the wells Fargol lawsuit I believe I might be a part of it.
    Who would I contact?

  3. Sedik

    March 19, 2012 at 3:36 pm

    I need contact name and number for Atty that is working on this case I have same situation. Please keep my name and email confidential.

  4. Joveta Parker

    March 23, 2012 at 3:37 pm

    Wells fargo has done the same thing to me, I have all my paperwork to prove that they rec. all my documents to modifiy my loan . BUT they tried to use thier own tatics to by holding on to my paperwork for 5 months, asking for the same documents over and over again. there is so much more that i can prove that wells fargo has done . please keep me in, and formed I have contacted a lender who listen to my story and told me to contact an attorney i have not yet done so, I need to know who to call and how i can be a part of this CLASS ACTION LAW SUIT, the lender i spoke with also told me that i had grounds to sue Wells fargo for many things they did with my loan and modified, pls provide informTION ON who to contact for the lawsuit

    • Amy Jo

      April 26, 2012 at 4:08 pm

      Am going thru same S. with Wells FO now & wonder if you got any relief/help anywhere. you call me at home if feel like it 303.459.0566. I am ready to purchase assault weapons at this point & really don’t even have $$ for that… wondered if you got any help

  5. usustarr

    March 28, 2012 at 4:19 pm

    Can some one tell me how to complain about Wells Fargo loan modification issues or how to join the class action law suite against them?

  6. Donna

    April 3, 2012 at 9:40 am

    someone help they but me in a bad situation and I need help before they take my home.

  7. Donna

    April 3, 2012 at 9:46 am

    I really need help,they misinformed me and now they will not let me make any payments.I need to get advise from someone trust worthy.I always paid my mortgage payments and now they want to take my house.

  8. Donna

    April 3, 2012 at 10:01 am

    Can some one tell me how to complain about Wells Fargo loan modification issues or how to join the class action law suite against them?

  9. Donna

    April 4, 2012 at 8:51 am

    did you find out who to contact please let me know

  10. shelly

    April 4, 2012 at 4:45 pm

    I need to join this lawsuit! I’m in the middle of this loan modification nightmare! I have been doing everything they tell me to do and then they tell me it’s at the underwriters, when I call them a month later, they tell me it’s NOT at the underwriters! I’ve been screaming on the phone to them for giving me this nightmare! My next step is getting their MAIN financial address and going there PERSONALLY with all my documents and refuse to leave the building until they fix what they screwed up! I am not losing my house because they are frauds! I will fight tooth and nail! Did anyone get any information about this lawsuit?

  11. Donna

    April 5, 2012 at 8:11 am

    I agree how come no one is answering us on what do do this is a nightmare can not even sleep at night what can we do

  12. Donna

    April 5, 2012 at 8:14 am

    I have been on the phone almost every day and they are so laid back about about it I COULD CHOKE THEM!!!!!!!!!!!!!!!!!!! They put me in this situation and they do not care

    • shelly

      April 5, 2012 at 5:38 pm

      Just to let everyone know…I forced the Wells Fargo representatives into talking to me and forcing them to get moving on my load modification…I am also DOCUMENTING EVERY conversation, time, date, people! Also, when they tell you that you can’t make a payment, they are wrong! I flipped out on one of the head representatives and found out you can send a payment but by mail ONLY. I am going to go the extra mile and send it registered so they can’t say they didn’t get it! I also informed her of the lawsuits being filed against them! Of course they claim they don’t know about it…I told her to research it online! If they don’t have my documents to the underwriter’s by Monday, 4/9/12 I am taking time off from work to go to their main office in California and handcuffing myself to their office til they fix what they screwed up!

      Yelling and screaming at them seems to get you a little farther…so get on the phone and give them hell!

  13. Donna

    April 9, 2012 at 10:49 am

    Shelly,let me know how you make out I just sent an eamil to the CEO and 10 other head people.I told them if I do not get any response today I will be going to the media.Anyone out there that wants to join please respond

  14. Donna

    April 9, 2012 at 12:53 pm

    Shelly contact the CEO,I just got a call from his office and they are taking over my case.I guess when I told them I would go to the news they woke up.I have the info if you need it.They are expediting it and will have answer in 3 days

  15. shelly mountain

    April 12, 2012 at 3:08 pm

    So, did the CEO help any?

  16. DONNA

    April 13, 2012 at 7:54 am

    Well the day I emailed the letter I got a call within an hour from a girl in his office who said she would be taking over my case,She sent me 15 more pages to fill out that was never sent to me with the first set of paperwork. I told her I never recieved these papers before.She replied that when we take over and expidite the process we make sure you have everything you need.I told her that is just another log in the fire,all those papers should come to us customers all at once.Just a way for them to prolong the process and go back and forth.She has called me everyday and it is in underwriting.If I do not have any answers by next week I will be going to the media.Anyone that wants to join me let me know the more people the better.I will go to every news station and news paper I am not playing around.

    • shelly mountain

      April 15, 2012 at 3:10 pm

      I’m with you on that one! Keep me posted!

  17. DONNA

    April 17, 2012 at 12:35 pm

    HOW ARE YOU DOING SHELLY HAVE YOU HAD ANY LUCK YET?

    • shelly mountain

      April 17, 2012 at 8:33 pm

      Had to do my taxes today so my next call to them will be tomorrow. I’m soooo looking forward to that! LOL How’s it going on your end?

  18. donna

    April 18, 2012 at 8:56 am

    well have not heard from them since thursday,called Friday and yesterday got voice mail left message.If I do not get a call by noon I will be sending the CEO another email.If this is not resolved by Friday I will be contacting all news stations and newspapers.They put me in this situation and I will not let them take my house.I am so peed off I could choke them.I can`t sleep right, worried all the time just waiting for those papers to come to my house.Let me know what happens today good luck

  19. Kelly

    May 7, 2012 at 5:04 pm

    Shelly & Donna, I want to join this lawsuit, I have documented all the lies I was told over the phone and I have all the paperwiork I’ve sent in to “them”.

  20. dani1984

    May 30, 2012 at 11:33 pm

    I DANIEL RODARTE WAS ALSO REFUSED A LOAN MODIFICATION NO PAPER WORK OR APPLICATION WAS REVIEWED EVEN THOUGH I LOST MY JOB WELLS FARGO DID NOT ATTEMPT TO HELP ME WITH MY HOME SITUATION.I WANT TO BE A PART OF THIS CLASS ACTION LAW SUIT 

  21. Sunshine50

    August 6, 2012 at 5:42 pm

    Hi, SOS…HELP…….I have been denied once again today from Wells Fargo. I have been trying to get a loan modification since February of 2010, yes 2010. They have strung me along like a puppet. I have done every thing they asked me to do(even sold a $33,000 paid for van for a $5,000 ford focus). I was not even late when I went to them. I just wanted a modification due to a divorce and I am 100% disabled. I have been willing to find a job (currently on SSDI) but every month, I apply for their latest and greatest “Programs” I get denied.
    The HUD approved counselors I immediately went to in March 2010, said I can afford my home if they reduce the interest payment & make it a 40 yr loan. I agreed and have waited for them. Working full time for Wells Fargo Mortgage & filling out their forms, faxes, answering the phone, making calls and time on the phone. Every day, every week, every month….Not one day down.
    Today they (the “Office of Executive Complaints” said to go “Short Sale” my home or “just do a Deed in Lieu”. OMG. They are taking a home away from me and 3 or my 4 children, which I built so that if my Spinal Bifida does get worse (am parallelized 85% fm waist down) and I have go back into a wheelchair, this hse will work for me since everything is on one level for myself. My children would still be upstairs.  I am loosing the battle. My children and I have not slept right since February of 2010. We just want our home to stay our home, which I had built for us.
    If anyone has a suggestion out there, email me at deborahoz@usa.com . I appreciate this moment to vent.  I am in the State of Maryland. God knows how many more people Wells Fargo is pulling from their homes. Our foreclosure rate is increasing daily. What is Obama doing??? Anyone out there have an answer please tell me. I am so afraid of tomorrow. Freddie Mac owns me and Wells Fargo is my servicer. I am a minority (puerto rican, grandfather African American, a woman and disabled) I have put over 40 hrs a week into paperwork & faxes & calls for Wells Fargo Mortgage. Yes, I have already contacted the State’s Attorney Generals office about the class action suit. It does not apply to me since I am Freddie Mac owned. Now what??
     

  22. Srbenoit56

    August 10, 2012 at 2:37 pm

    I was apart of this wells Fargo mess and I want justice I suffered pregnant for months

  23. tntsmom

    September 13, 2012 at 7:14 pm

    My husband and I have been to h++ and back with Wells Fargo and it took TWO YEARS to get a modification and when we did our payment was $300 more a month than when we started. They have screwed our credit and I will go to any and all lengths to see justice done to them.  We now tried to refinance with them and have been in the process since July and was told today September 13th that they will not be able to refinance us because they now need 2 months of bank statements without NSF. We were set to close October 1st per the paperwork we received and again got SCREWED!!!

  24. Pierre Antoine

    November 17, 2012 at 1:08 pm

    I’m Pierre R. Antoine.In 2007, I applied for a loan modification from Wells Fargo. At that I had good credit,but was struggling to make  my mortgage payments on time.As I never missed payments,I applied for loan modification. Upon to be qualified for, I was told to hold my mortgage payments up to six Months(6) My loan’s interest was 6.5% and Wells Fargo gave me an interest 5% after the loan modification was granted. In addition that, My home was on foreclosure, my credit score dropped and Had to pay  all of late charges for missing payments.Moreover, I had to put down a lump sums in order to qualified for a new loan. Now, as I owe more than what my home worth, I applied for a loan modification to lower my mortgage which is 920.00 dollars a month,was denied because I already had one previously.So, in my situation ,I want to do.Furthermore, my loan term was 15 years, and I had left 7 years to pay off, to me I’m also a victim fro Wells Fargo Home Mortgage.

  25. Orlando

    June 8, 2016 at 6:24 pm

    I lost value on my second home from 600k to 215k l called wells fargo to modify my loan at market value, I filled out paper work I faxed 3 tomes they claim did not get eventhow they were faxed from their own bank fax machine and i got confirmation. After months of waiting they denied the modification and was sold as a short sale for 215k. Before going into default I called for this modifications and I was told that I have to be 3 monts on default and in forclosure before they csn try to help me. I could have kept that house if it was refinance at 215k. Is there a class action law suit against this situation?

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Mortgage

Mortgage application volume falls 8.1 percent in one week

Mortgage application volume fell last week, even accounting for the federal holiday, as certain interest rates jumped up a bit in the same period.

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Mortgage application volume took a dip last week

According to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 25, 2013, mortgage application volume fell 8.1 percent from the week prior, including adjustments to account for the federal holiday.

The Market Composite Index, a measure of mortgage loan application volume, decreased 8.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 17 percent compared with the previous week. The Refinance Index decreased 10 percent from the previous week.

The seasonally adjusted Purchase Index decreased two percent from one week earlier. The unadjusted Purchase Index decreased six percent compared with the previous week, but was two percent higher than the same week one year ago.

The refinance share of the mortgage application volume fell to 79 percent of total applications from 82 percent the previous week, continuing to hover around 80 percent where it has been for years. The adjustable-rate mortgage (ARM) share of activity increased to 4 percent of total applications. The HARP share of refinance applications increased to 26 percent from 25 percent the prior week.

The MBA reports, “The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances rose to 3.67 percent, the highest level since September 2012, from 3.62 percent, with points decreasing to 0.42 from 0.43 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The contract interest rate for 30-year fixed mortgages has increased for six of the last seven weeks. The effective rate increased from last week.”

Current average contract interest rates

According to the MBA:

  • The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) increased to 3.95 percent from 3.85 percent, with points increasing to 0.39 from 0.34 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.48 percent from 3.40 percent, with points decreasing to 0.33 from 0.53 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 15-year fixed-rate mortgages increased to 2.95 percent from 2.87 percent, with points decreasing to 0.38 from 0.39 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 5/1 ARMs decreased to 2.60 percent from 2.61 percent, with points increasing to 0.33 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

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Mortgage

Mortgage application volume surges in second week of 2013

Mortgage application volume in the second week of the year jumped, led by new mortgage applications, a healthy sign for housing and buyer interest.

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mortgage application volume

Mortgage application volume jumps in January

According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 11, 2013, mortgage application volume increased 15.2 percent from one week earlier, led by a strong increase in new mortgage applications.

The Market Composite Index increased 15.2 percent on a seasonally adjusted basis from the week prior, and on an unadjusted basis, the Index increased 45 percent during the same period as the Refinance Index increased 15 percent from the previous week.

The seasonally adjusted Purchase Index increased 13 percent from one week earlier to the highest level since April 2011. The unadjusted Purchase Index increased 47 percent compared with the previous week and was 5 percent higher than the same week one year ago.

The refinance share of mortgage activity remained unchanged at 82 percent of total applications from the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 3 percent of total applications.

Current mortgage interest rates

According to the MBA:

  • The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) remained unchanged at 3.61 percent, with points decreasing to 0.38 from 0.41 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) increased to 3.88 percent from 3.78 percent, with points unchanged at 0.38 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.39 percent from 3.35 percent, with points decreasing to 0.58 from 0.69 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
  • The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 2.88 percent, with points decreasing to 0.27 from 0.39 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
  • The average contract interest rate for 5/1 ARMs increased to 2.66 percent from 2.64 percent, with points decreasing to 0.34 from 0.37 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

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Housing News

Fiscal cliff uncertainty means new low for mortgage rates

While mortgage rates have remained low in recent years, mortgage application volume rose last week as rates hit a new low, resulting from uncertainty over the fiscal cliff, according to the MBA.

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Mortgage rates hit new low, application volume rises

According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 7, 2012, mortgage application volume increased 6.2 percent from the previous week, with an 8.0 percent increase in refinance applications and a 1.0 percent increase in new mortgage applications.

“Continued uncertainty due to the lack of resolution regarding the fiscal cliff led interest rates lower last week, with mortgage rates reaching a new low in our survey,” said Mike Fratantoni, MBA’s Vice President of Research and Economics.

“Refinance activity increased,” Fratantoni said in a statement, “with the refinance index hitting its highest level in two months, and the refinance share reaching its highest level since January 2009. Applications for purchase increased for a fifth consecutive week, and are running almost ten percent above their level at this time last year.”

The refinance share of mortgage activity increased to 84 percent of total applications from 82.0 percent the previous week, while the adjustable-rate mortgage (ARM) share of activity remained at 3.0 percent of total applications. The HARP share of refinance applications increased to 29.0 percent from 27.0 percent the prior week.

Current mortgage rates

According to the MBA:

  • The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) decreased to 3.47 percent, the lowest rate in the history of the survey, from 3.52 percent, with points decreasing to 0.36 from 0.41 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 3.77 percent from 3.79 percent, with points increasing to 0.35 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
  • The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.32 percent, the lowest rate in the history of the survey, from 3.34 percent, with points decreasing to 0.51 from 0.62 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
  • The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.85 percent, the lowest rate in the history of the survey, from 2.86 percent, with points decreasing to 0.26 from 0.27 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
  • The average contract interest rate for 5/1 ARMs increased to 2.63 percent from 2.62 percent, with points decreasing to 0.34 from 0.40 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

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