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Wells Fargo mortgage payment fiasco: What to know about the bank’s latest scandal

Wells Fargo customers looking for COVID-19 information reportedly had their mortgages placed into automatic forbearance.

Wells Fargo mortgage payment fiasco: What to know about the bank’s latest scandal
[Photo: Eric Brehm/Unsplash]
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If you have a mortgage with Wells Fargo, you’re going to want to check its current status ASAP. That’s because said mortgage may be in forbearance without you knowing about it, reports NBC News. A mortgage in forbearance could affect the owner’s credit options and their ability to refinance to take advantage of historically low rates right now.

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Here’s what happened: In March, some Wells Fargo customers began seeing a link on the company’s website that stated customers should click it if they’ve been affected by the COVID-19 pandemic. It’s natural to assume that clicking on such a link would provide information on what Wells Fargo was doing to help their customers during the pandemic, but instead, customers say after entering their details to receive information, their mortgages were automatically placed into forbearance.

The problem: Under the CARES Act passed earlier this year, Congress allowed for mortgage holders to enter into forbearance to have their payments suspended without being penalized. However, Wells Fargo customers in 14 states have now said they were entered into forbearance programs without their consent. This is a problem for those customers because when a mortgage is in forbearance, they cannot refinance their mortgage at other banks. And during the pandemic, mortgage interest rates are lower than they’ve been in a long time, which could save mortgage holders hundreds each month.

What Wells Fargo is saying: In a statement, a Wells Fargo representative told NBC News, “In the spirit of providing assistance, we may have misinterpreted customers’ intentions in a small number of cases. In those limited cases, we are working directly with customers to ensure they are receiving the assistance they need and make any corrections to their accounts that may be required.”

The statement went on, “As soon as COVID began to impact our customers, Wells Fargo was intently focused on assisting any customers who needed help, and we have deferred 2.5 million payments for consumer and small business customers as a result. During the early stages of the crisis—even before the CARES Act was passed—we provided relief to mortgage and home equity customers who we learned were impacted by COVID over the phone, through our secure email channel, or through other means. Customers placed in forbearance received notices of that action through multiple channels, and we removed them from forbearance upon their request.”

What can Wells Fargo customers do? You should immediately check if your mortgage has been placed in forbearance without your knowledge. If so, you should contact Wells Fargo right away to have the forbearance removed.