Wells Fargo to Pay $80 Million+
The Department of Justice indicated on Thursday, November 5th,2015 that Wells Fargo will be required to pay over $80 million for having mishandled the mortgages for accounts where homeowners were in bankruptcy. This amount will be used for refunds and credits to over 60 thousand homeowners. The amount was arrived at through a settlement. It seems that Wells Fargo was not properly providing notices showing changes they imposed for mortgage payments when the homeowner was in bankruptcy. Failing to provide the necessary proper notices was in violation of rules geared toward ensuring an accurate accounting for the debtors costs in bankruptcy. This has been a federal rule for as long as 2011. The federal rule requires mortgage lenders to notice borrowers in Chapter 13 bankruptcy not less than three weeks notice of any changes made in mortgage payment obligations.
Wells Fargo is said to have failed to provide proper notices over 100,000 times and the giant bank acknowledged this as part of the settlement.
Additionally, Wells Fargo, failed to properly review thousands of escrow accounts which it maintained. The failure resulted in homeowners paying both too much and at times too little into the accounts maintained for paying property taxes and the like.
A spokesperson for the Justice Department indicated how such failures to comply with bankruptcy laws go toward compromising the integrity of the bankruptcy system. A statement issued by Wells Fargo gave assurances that steps have been taken and employed to prevent such omissions in the future.
