In March, Tammi Wilson was reviewing her family’s mortgage in Wells Fargo online when she saw a link to information about COVID-19 on the bank’s website. After clicking, she provided contact information to receive program materials at the bank. Days later, she said she returned to the payment page to convey what she and her husband David owed on their loan. A message appeared saying that you had no active accounts and that you could not make the payment.
Wilson later found out what had happened. Without her knowledge, the bank had included her in a program that suspended payments on her federally backed loan. Known as forbearance, it is a CARES Act program that aims to help borrowers who are having trouble making payments because COVID has hurt them.
Since he had not asked for the bank’s help, Wilson continued to make all of his family’s mortgage payments. She has also spent hours on the phone with Wells Fargo to exit the program. Finally, on July 1, the bank sent her a letter confirming her request to “choose not to participate” in the program in which she said she never opted.
Watch Stephanie Gosk tonight on NBC Nightly News with Lester Holt for more information on this story.
Still, Wilson’s credit report, dated July 18 and reviewed by NBC News, shows that the family mortgage is “in patience” and that the April and May payments were not credited to the account, despite the fact that the Wilson presented them.
While lenient, Wilson and her husband are almost unable to refinance their mortgage because most banks will not take out new loans for borrowers whose mortgage payments are suspended. As long as the tolerance notation remains on their credit report, the Wilsons can’t take advantage of fund interest rates and are stuck in Wells Fargo.
“I click on this button and the next thing I know is that I get something that says I’m deferred and I can’t reverse something that I didn’t even want,” Wilson told NBC News. “If you’re going to help people, there’s a super simple first step: just ask, ‘Do you need our help?'”
Under the CARES Act, which provides help on loans backed by government-sponsored companies Fannie Mae, Freddie Mac, Ginnie Mae, and others, borrowers hurt by COVID-19 can apply to suspend their mortgage payments for up to one year. Amounts owed during the period are either added to the end of the loan or paid early. No additional fees, interest, or penalties can be accrued on the loans while they are lenient.
Last week, NBC News reported on Chapter 13 bankruptcy borrowers whom Wells Fargo had placed, without their permission, on leniency programs. But the bank’s practice extends beyond these specialized borrowers, some of whom contacted NBC News.
Wells Fargo is one of the largest banks in the United States that underwrites and services mortgage loans. Borrowers in at least 14 states have told the courts, lawyers or NBC News that Wells Fargo has forced them to adopt leniency plans. The states are Alabama, Arizona, California, Florida, Kansas, Louisiana, Michigan, Missouri, New Jersey, New York, New Hampshire, North Carolina, Texas, and Virginia.
“In the spirit of providing assistance, we may have misinterpreted clients’ intentions in a small number of cases,” Mary Eshet, a Wells Fargo spokeswoman, said in a statement to NBC News. “In those limited cases, we are working directly with clients to ensure they receive the assistance they need and to make corrections to their accounts that may be necessary.”
The statement also noted: “As soon as COVID started impacting our customers, Wells Fargo focused intensely on helping customers who needed help, and as a result we have deferred 2.5 million payments for consumer and small business customers. During the early stages of the crisis, even before CARES was passed, we provided relief to mortgage and home equity clients who we learned were affected by COVID by phone, through our secure email channel, or by other media. Clients placed on leniency received notices of that action through multiple channels, and we removed them from leniency upon request. “
It could not be determined if Wells could benefit from voluntary lenders for leniency and
The bank statement did not answer that question. By retaining borrowers who could otherwise refinance their mortgages with another institution, Wells Fargo continues its business. Wilson, for example, said he would like to transfer his mortgage to a different bank, but he is afraid that he will not be able to give his credit report.
This is not the first time that Wells Fargo has registered customers for unsolicited services. The bank has been under pressure in recent years to open unsolicited bank accounts and credit cards for customers; it forced others to buy auto insurance that they did not need and in some cases they were not informed.
Sherrod Brown, an Ohio Democrat who is the highest-ranking member of the Senate Banking Committee, called the bank for his actions.
“Once again, it appears that Wells Fargo’s sloppy service and mismanagement are hurting consumers,” it said in a statement. “Wells Fargo must immediately address each of these complaints and make changes to ensure that no borrower is worse off than the actions their manager takes without their consent or notice.”
Eileen Roth, a math teacher in New Hartford, New York, is another Wells Fargo client in an unwanted indulgence. Like Wilson, Roth’s tolerance appears on her credit report.
She told NBC News that because her mortgage payments are automatically deducted from her bank account, she usually doesn’t care about them. She had not asked the bank to suspend her payments, but on June 22 she received a phone call from Wells Fargo. The representative said that because she had been on tolerance since March 20, her mortgage payments had stopped being deducted from her bank account.
Roth said she was shocked and angry and told the bank that she was not interested in the program. The Wells Fargo employee insisted that Roth requested it “by mistake” on the bank’s website, Roth said; It was not her mistake, she added.
“They never asked me to put me on that show,” Roth told NBC News. “I started to feel anxious because now, through no fault of mine, I have this on my record.”
To protect borrowers with problems from damage to their credit reports during COVID, the CARES Act states that if a bank makes an arrangement for a consumer, such as suspending mortgage payments, it cannot report a change in the status of the borrower , how to stop being current. But when Wells Fargo reports that borrowers are lenient, that indicates a change in their status, raising questions about the practice.
The Wells Fargo spokeswoman said that “the bank’s credit reports for customers in a COVID-19 tolerance are consistent with the requirements of the CARES Act, the guidelines of the Consumer Data Industry Association and the expectations of our These requirements include informing customers that they were current on their mortgage or home equity payments when they entered a COVID leniency as “Current” with a special comment indicating the account is lenient. “
In late March, Gerald Forsburg of Mount Jackson, Virginia, also visited the Wells Fargo website and quickly found himself on a tolerance plan. Unfortunately for him, that plan ruined the loan modification he had obtained from Wells Fargo days earlier and that had reduced his monthly payments by more than $ 200.
Forsburg said he visited the Wells Fargo website to check on the status of his loan modification. This button appears. If COVID has affected you, click here. I don’t remember clicking anything else, ”he told NBC News.
On May 1, when she went online to make her first lower payment under the loan modification, the system did not allow her to pay. His account showed only the highest amounts owed on his previous loan. Then in June Wells Fargo sent him a letter informing him that his suspension of the mortgage payment had been extended for three more months.
“When I clicked on the original button, I didn’t know I was getting a tolerance,” said Forsburg. “There was no description of the legal ramifications of clicking that button. It is very scary for me and my family. We don’t want to lose our house. “
Thad Bartholow, attorney for Kellett & Bartholow, represents Forsburg in a lawsuit against Wells Fargo. He said, “Tolerance is an extremely powerful medicine. It is like putting someone on opioids for a slight headache after being told they did not want or need anything.”
According to the Office of Consumer Finance Protection, before a loan servicing bank can grant tolerance, you are supposed to receive a certification from the borrower of a COVID-related financial hardship. But none of the Wells borrowers who shared their stories with NBC News had provided such documents to the bank.
Eshet, the Wells Fargo spokeswoman, did not say why the bank does not require a certificate from borrowers.
