A Wells Fargo Error Led to 545 Mistaken Home Foreclosures
A “calculation error” in Wells Fargo’s underwriting tool led to 545 mistaken home foreclosures over the past eight years, the bank announced Tuesday. The latest government filing adds well over 100 homes to a previous report on the apparent computer glitch, which estimated 400 unnecessary foreclosures.
According to the filing, the error overestimated the attorney’s fees for homeowners in the foreclosure process between March 15, 2010, and April 30, 2018, when new controls were implemented. The error led the bank to reject customers’ requests for a mortgage loan modification or repayment plan in 870 cases where the homeowner should have been qualified. Of the 870, approximately 545 were eventually foreclosed upon.
“We’re very sorry that the errors occurred and have assigned a single, dedicated point of contact to ensure that each customer is engaged with and assisted individually,” Tom Goyda, a spokesman for the company, told Reuters.
Wells Fargo said it has already contacted the majority of the affected customers to provide remediation and offer no-cost, independent mediation, and will reach out to the others. The bank set aside $8 million to compensate customers when the error was originally discovered in August.
While the review of its mortgage loan modification tools is ongoing, Wells Fargo continues to handle the PR aftermath of previous mistakes. Over the past two years, the bank has be exposed for opening unauthorized deposit and credit-card accounts, altering corporate customers’ information, charging customers for unwanted car insurance, and overcharging customers to inflate bonuses.
