Losing a house to foreclosure is a traumatizing event for homeowners. Some people in Florida are able to modify their loans or utilize certain federally-backed programs to stop home foreclosure. However, it recently came to light that a Wells Fargo mistake caused hundreds of people who qualified for help to be denied, which ultimately cost them their homes.
From April 2010 to Oct. 2015, a Wells Fargo tool malfunctioned and miscalculated at least 625 requests for federally-backed mortgage modifications. All of the affected customers were already in foreclosure and qualified for the program, but because of the miscalculations, Wells Fargo denied their requests. Of those who were affected, 400 went on to lose their homes.
Wells Fargo has since offered up $8 million to the affected homeowners. This may seem like a substantial amount, but it breaks down to only about $20,000 per person. The vice president of the National Community Stabilization Trust pointed out that the amount offered hardly accounts for the full-range of damages. Not only did victims suffer financial problems and lose their homes when they did not have to, but most people who go through foreclosure suffer lifelong physical and mental health problems. Children whose parents have had their homes foreclosed on also suffer notable mental health issues as well.
Florida homeowners who hope to stop home foreclosure should take action as early as possible. This means approaching lenders before they have even taken foreclosure action. Since achieving a loan modification can involve a considerable amount of paperwork and negotiations, some homeowners choose to work alongside an experienced counsel who can provide adequate guidance where needed.