New York”™s attorney general has accused Wells Fargo Bank N.A. and Bank of America ”“ each with prominent regional footprints ”“ of a combined 339 violations of a 2012 federal mortgage agreement and expressed a willingness to right the alleged abuses via lawsuit.
Not so, said Wells Fargo and B of A of the charges. The banks in separate statements professed both transparency and an eagerness to address the allegations. Wells Fargo further lamented Attorney General Eric Schneiderman had chosen a public forum to air the allegations rather than engaging in “constructive dialogue.”
The attorney general in a prepared statement May 6 said, “Signed in 2012, the mortgage settlement required the five largest mortgage servicing banks in the United States to improve their customer service practices by complying with new mortgage servicing rules, known as the Servicing Standards. Among these are four standards dictating the timeline for banks to process mortgage modification applications. The attorney general”™s office has documented 339 violations of those standards by Wells Fargo and Bank of America since October 2012.”
Bank of America responded via Senior Vice President for Communications Dan Frahm, who said in an email to the Business Journal: “Through March we have provided relief for more than 10,000 New York homeowners through the National Mortgage Settlement, totaling more than $1 billion. Attorney General Schneiderman has referenced 129 customer servicing problems, which we take seriously and will work quickly to address. This agreement has been good for New York, and we continue using these beneficial programs to assist troubled homeowners in New York and nationally.”
Wells Fargo issued the following statement: “Wells Fargo is committed to full compliance with the National Mortgage Settlement and its associated standards. It is unfortunate that the New York attorney general has chosen this route rather than engage in a constructive dialogue through the established dispute resolution process.
“We fully support the rules established under the Settlement and we will continue to provide transparency into the progress we are making to provide relief to consumers,” Wells Fargo continued. “Wells Fargo has helped more than 70,000 homeowners across the country through national mortgage settlement programs and we will continue to do everything we can to help all borrowers, including the New York families described today.”
The five banks in the settlement were Bank of America, Wells Fargo, Citi, Ally/GMAC and JPMorgan Chase.
According to a joint statement from 49 state attorneys general, “The 2012 settlement provides as much as $25 billion in relief to distressed borrowers and direct payments to states and the federal government. It”™s the largest multistate settlement since the Tobacco Settlement in 1998.
“The agreement settles state and federal investigations finding that the country”™s five largest mortgage servicers routinely signed foreclosure related documents outside the presence of a notary public and without really knowing whether the facts they contained were correct,” the attorneys general said, calling the practices illegal. “The settlement provides benefits to borrowers whose loans are owned by the settling banks as well as to many of the borrowers whose loans they service.”
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