For hundreds of homeowners, a simple computer glitch directly contributed to them losing their homes. This computer glitch was part of a Wells Fargo tool that helped homeowners calculate whether they would qualify for a federally-backed program that would allow them to lower their mortgage payments and thus stay in their homes.
According to Wells Fargo representatives, between April 2010 and October 2015, a total of 625 customers who would have otherwise qualified for this modification were falsely denied the modification. As a result, 400 individuals were reported as losing their home.
Wells Fargo representatives argued that these individuals were already in foreclosure before requesting modification of their mortgages and were at risk of losing their homes regardless. The representatives argued that the individuals who did lose their homes would have likely lost their homes even if the software program had worked correctly.
Wells Fargo is offering the customers who were affected by the computer glitch financial compensation for their damages, in the amount of $8 million. That amounts to approximately $20,000 per customer, which pales in comparison to the losses they have sustained. Some of these individuals might never get their homes back.
The question that remains is whether this could have been prevented?
According to the National Community Stabilization Trust, computer glitches like this are pretty common. Certain steps can be taken to avoid becoming a victim. For one, it helps to contact a qualified intermediary to get assistance in restructuring the mortgage. A 2016 law requires mortgage providers to give written notice to allow for early intervention to help borrowers who may not know their options and know ways to help avoid foreclosure. Several programs, including housing counseling or legal assistance can be found by going to the U.S. Department of Housing and Urban Development site. The Consumer Financial Protection Bureau (CFPB) likewise offers services that allow people to find programs in their geographical area.
Homeowners facing financial difficulties are also recommended to contact their banks for assistance. Reaching out for help before things get out of hand is better than missing too many payments, which can start the foreclosure process. At that point, the banks may be less likely to want to work with the homeowner. It is also often best to personally communicate with the bank in person rather than over the phone or through an online chat. Speak with a representative and see what options are available.
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Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.