Wells Fargo was one of the mortgage lenders who participated in a hearing conducted by the House Committee on Oversight and Government Reform. Michael Heid, the co-president of Wells Fargo Home Mortgage delivered testimony before the committee and spoke about Wells Fargo’s participation in the Obama Making Home Affordable Program.
Many homeowners have been angry and upset over there experience within the home loan modification program and lenders have been heavily criticized over what is perceived to be an uncaring attitude and unwillingness to help homeowners avoid foreclosure. However, Wells Fargo Home Mortgage Co-President, Michael Heid, gave some figures on Wells Fargo’s participation and work with homeowners and modification program.
He stated that Wells Fargo has helped close to half of a million customers who were struggling to make their mortgage payment by offering either a trial or full home loan modification. He stated that these modifications were made both through Wells Fargo programs and the Home Affordable Modification Program.
Also, it was stated that over 100,000 unemployed homeowners were given short-term modifications, which are similar to the program that has been proposed by the government modification program. In terms of principal forgiveness, Mr. Heid also said that Wells Fargo had made principal reductions to the sum of over $3 billion for homeowners who were suffering with an underwater mortgage.
Like many lenders, the representative from Wells Fargo also said that their company was working to help homeowners prevent foreclosure simply because it’s in the best interest of both the bank and homeowners to find alternatives and keep individuals in their home. Wells Fargo, along with other financial institutions, have been working to make modifications on both first and second-lien loans.
However, one citation about troubles in the modification program came in the form of customer ineligibility. Mr. Heid stated that the Treasury Department estimates that only 3 of every 10 customers with Wells Fargo who are delinquent may qualify for a home loan modification. Customer error was also mentioned as one of the main problems within the modification program for Wells Fargo. Lack of documents, simple ineligibility, and the inability of homeowners to make payments during their modification trial period were the main causes of a failure to receive a permanent home loan modification.
Also, like other lenders, Wells Fargo says they are willing to work with their homeowners who may be unable to qualify for a modification or who simply may be unable to afford their home despite mortgage assistance. They are also offering short sale options and deed-in-lieu of foreclosure plans as well.
However, Wells Fargo has stated they are committed to doing more to keep homeowners in their home and avoid foreclosure. Mr. Hyde stated Wells Fargo will soon implement a program where one person will be assigned to a homeowner’s modification and will work with that individual from the beginning of the process to the end.
While there have been no perfect lenders in the modification program and Wells Fargo has been criticized just like other lenders, it still advisable that homeowners with a Wells Fargo home loan who are struggling to make their home loan payment contact their lender and ask about various programs or options that may be available to help them keep their home.