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Wells Fargo on the hook for HAMP class actions

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Mortgage Professional America | 09 Aug 2013, 05:32 AM Agree 0
Two class-action lawsuits against Wells Fargo are back on after a federal court ruled that the banking giant was obligated to offer permanent mortgage modifications to borrowers who met certain requirements
  • Sara brainard | | 09 Aug 2013, 09:24 AM Agree 0
    This exact thing has happened to me with Citibank. I made the payments required, and gor jerked around for over three years. How can I make Citibank honor the hamp rules?
  • Wm Matz | | 09 Aug 2013, 12:24 PM Agree 0
    This case is not groundbreaking, as it follows the 7th Circuit's [IL] 2012 decision in Wigod v. Wells Fargo. But it is important in extending the reasoning to the 9th Circuit [West Coast]. So the only two Federal Courts of Appeal to have decided this issue have ruled in favor of borrowers being able to sue for wrongfully-denied mods. That makes it very likely that Federal trial courts in other jurisdictions will follow, even if their circuit Court of Appeals has not yet ruled.

    While this case is welcome news for West Coast borrowers, the groundbreaking case came from the California Court of Appeals. in Glaski v. Bank of America [just approved for publication] an appeals court held for the first time in CA that borrowers who can show that their securitized mortgage was not transferred into the securitization trust in compliance with the trust terms [usually more than three months after trust creation] can stop a foreclosure, because the named beneficiary does not legally own the mortgage. More importantly, the court held that a completed foreclosure by the erroneous beneficiary, is VOID!!! That means affected foreclosed borrowers can recover their homes; however, they will be subject to a new foreclosure by the legal owner of the mortgage, if that can be determined. Borrowers may well be entitled to damages for the wrongful foreclosure that could be offset against the mortgage balance.

    This problem has already been addressed in judicial foreclosure states, such as MA, NY, and FL. But the problem in CA has been ignored by CA courts [despite vigorous protests by borrower attys] because all foreclosures have been done non-judicially [trustee sales]. This decision, which is clearly correct legally, will create a nightmare of litigation and confusion for CA real estate titles. E.g., many foreclosure/REO sales to flippers can legally reversed. There will be massive claims on title insurance and on sellers for bad title.

    It is important to remember that all of these problems are the direct result of Wall St/lenders failing to follow the rules they set up themselves to securitize these mortgages. And now we are even finally starting to see criminal charges around the securitization. Perhaps Wall St and the lenders will finally have to pay for a decade or more of unbridled greed.
  • Mary | | 09 Aug 2013, 02:59 PM Agree 0
    They can't tag this one on the broker originator. Wells did this all on its own!
  • Patricia Whitman | | 08 Oct 2013, 06:57 AM Agree 0
    Wells Fargo always made us start over with the paperwork. Their supervisors disappeared and when we were asking to modify the mortgage they seemed happy to send us more paperwork, but them never process it when we sent it back. We were never late with out payments 12 years and this is how they treat their customer.
  • Patricia Whitman | | 08 Oct 2013, 07:01 AM Agree 0
    My husband and I tried several times to get Wells Fargo to process our application for Hamp. Every time we called there was a "new" supervisor. We were never late with our mortgage payment (12 yr.) and when my husband lost his job...we lost the house.
  • Carl M | | 12 Oct 2014, 03:46 PM Agree 0
    How can I become part of this law suit? I was dragged around for 9 months making the agreed upon modified payments only to be denied and have my credit ruined. I talked to another mortgage officer (local) and the 9 months seems to be intentional as they marked all of my payments as late and I now have what is considered a foreclosure on my credit. As it stands, Wells Fargo ensured I am untouchable by any other lender for 10 years.
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