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Wells Fargo Refusal of Proper Response to Borrowers RESPA Class Action

If you ask your mortgage servicer for information, can the servicer refuse to provide it? The complaint for this class action alleges that Wells Fargo Bank, NA violated the Real Estate Settlement Procedures Act (RESPA) when it refused to answer customer Requests for Information (RFIs) and Notices of Error (NOEs).

RESPA allows a borrower to send a qualified written request (QWR) to the servicer of a “federally related mortgage loan” to either request information or assert that there is an error in the borrower’s account. The servicer must then acknowledge the request within five days and provide an answer within thirty days. In the case of an error, the answer should include either a correction of the account or an explanation of why the servicer believes the account is correct.

In January 2013, the Consumer Financial Protection Bureau (CFPB) added Regulation X, which set forth a number of rules for mortgage markets, including guidance on responses to QWRs. 

In this case, three different plaintiffs sent QWRs to Wells Fargo, the servicer for their mortgages. The letters consisted of RFIs or NOEs. In all three cases, Wells Fargo refused to provide answers, saying that their “account[s were] in active litigation” and that it would not respond to the QWRs “because the issues raised are the same or very closely related to the issues raised in the pending litigation.”

The complaint claims that there is no “active litigation” exception to the law requiring answers to QWRs. 

The complaint asserts, “Wells Fargo’s practice of sending Active Litigation Letters and failing to provide substantive responses to borrowers QWRs, RFIs, and NOEs is part of a sustained pattern and practice of noncompliance with RESPA and Regulation X.” Not only that; the complaint says that “Wells Fargo’s conduct was already the subject of a prior class action lawsuit filed in this District against Wells Fargo, as well as other lawsuits across the country.”

The assertion of an Active Litigation exception is particularly problematic because, the complaint says, “a majority of homeowners sending QWRs, RFIs, and/or NOEs are involved in defending against foreclosure” so that “permitting this kind of conduct would allow mortgage servicers and creditors … to unjustly hide behind the foreclosure process to unlawfully extinguish their obligations under RESPA and Regulation X.”

The class for this action is all borrowers in the US (1) who sent to Wells Fargo a Qualified Written Request in the form of a Request for Information or Notice of Error, and (2) to whom Wells Fargo refused to provide a complete response in reference to the information requested or perform an investigation into errors, on the grounds that the accounts were in “active litigation” or that “the issues raised are the same or very closely related to the issues raised in the pending litigation.”

There is a subclass for those in the class who submitted a second QWR after the first one was rejected.

Article Type: Lawsuit
Topic: Consumer

Most Recent Case Event

Wells Fargo Refusal of Proper Response to Borrowers RESPA Complaint

November 7, 2019

If you ask your mortgage servicer for information, can the servicer refuse to provide it? The complaint for this class action alleges that Wells Fargo Bank, NA violated the Real Estate Settlement Procedures Act (RESPA) when it refused to answer customer Requests for Information (RFIs) and Notices of Error (NOEs).

wells_fargo_respa_written_responses_compl.pdf

Case Event History

Wells Fargo Refusal of Proper Response to Borrowers RESPA Complaint

November 7, 2019

If you ask your mortgage servicer for information, can the servicer refuse to provide it? The complaint for this class action alleges that Wells Fargo Bank, NA violated the Real Estate Settlement Procedures Act (RESPA) when it refused to answer customer Requests for Information (RFIs) and Notices of Error (NOEs).

wells_fargo_respa_written_responses_compl.pdf
Tags: Failure to Provide Proper Info on Mortgage, Mortgage-Related Unfair Practices, Servicing Your Mortgage, Your Bank