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Wells Fargo Attempt to Collect Waived Deficiency Amount FDCPA Class Action

Does any company in the country have a greater variety of class actions filed against it than Wells Fargo? The complaint for this class action claims that Wells Fargo violated the Fair Debt Collection Practices Act (FDCPA) by collecting or trying to collect residential loans it had previously extinguished and which the borrowers had no legal obligation to pay. 

The class for this action is all persons with a residential purchase or refinance loan from Wells Fargo, secured by real property in the US, where Wells Fargo waived the deficiency of the loan on the property, then tried to collect payment on it, between October 19, 2014 and October 14, 2018.

Two plaintiffs, Rose Mary Rawls and John M. Rawls, bought a single-family home in St. Petersburg, Florida in February 2005. In 2009, the US suffered an economic downturn. The home decreased in value and was eventually worth less than the amount of the couple’s mortgage on it. Also because of the economic downturn, the couple was unable to keep paying the mortgage. 

In June 2012, Wells Fargo okayed a short sale of the home. It sent the Rawls a letter saying their “shortfall amount … is forgiven.” The company also filed a Satisfaction/Release of Mortgage document with the county clerk in Florida that said that the mortgage was “secured, fully paid and satisfied.” Both of these documents are attached to the complaint as exhibits.

However, in October 2017, Wells Fargo sent the couple a letter referencing the loan number from the mortgage and saying that the couple were to continue making monthly payments on the amount. The complaint alleges that Wells Fargo misrepresented to the Rawls that they still owed money on their mortgage and initiated misleading collection efforts to try to get the Rawls to pay an amount they no longer owed.

The experience of the third plaintiff, Carmela Fournier, was similar. She also took out first and second mortgages to buy a home. During the same economic downturn, the home became worth less than the mortgage and she was unable to make payments. 

Wells Fargo approved a short sale in 2016 and sent Fournier a letter on the first mortgage saying that “if you comply with these requirements of this Notice of Approval and the mortgage is released, Wells Fargo Bank, NA will waive its right to seek a deficiency balance under the mortgage note…” It sent another letter on the second mortgage saying, “The deficiency balance …  is waived.” The letters are attached to the complaint as well. 

But in October 2017, she received a letter referencing her loan number and saying she should continue to make her monthly payments. 

The complaint alleges that Wells Fargo has violated the FDCPA by representing the character, amount, and/or the legal status of the two mortgage loans and sending out letters with deceptive or misleading information.

Article Type: Lawsuit
Topic: Consumer

Most Recent Case Event

Wells Fargo Attempt to Collect Waived Deficiency Amount FDCPA Complaint

October 19, 2018

Does any company in the country have a greater variety of class actions filed against it than Wells Fargo? The complaint for this class action claims that Wells Fargo violated the Fair Debt Collection Practices Act (FDCPA) by collecting or trying to collect residential loans it had previously extinguished and which the borrowers had no legal obligation to pay. 

wells_fargo_fdcpa_complaint.pdf

Case Event History

Wells Fargo Attempt to Collect Waived Deficiency Amount FDCPA Complaint

October 19, 2018

Does any company in the country have a greater variety of class actions filed against it than Wells Fargo? The complaint for this class action claims that Wells Fargo violated the Fair Debt Collection Practices Act (FDCPA) by collecting or trying to collect residential loans it had previously extinguished and which the borrowers had no legal obligation to pay. 

wells_fargo_fdcpa_complaint.pdf
Tags: Attempt to Collect Settled Debt, Attempting to Collect a Debt Not Owed, FDCPA, Unlawful Debt Collection