What the Wells Fargo Scandal Means for Mortgage Borrowers
This should of been the question during the foreclosure crisis…
Mortgage lending could be collateral damage
But the CFPB’s consent order, daily news reports and two Congressional hearings have failed to produce specific data on exactly how many Wells Fargo customers were harmed by the bank’s conduct, and the extent of the damages they have suffered.
This leaves many to wonder — has the scandal affected Wells Fargo’s mortgage customers?
The illegal conduct of Wells Fargo’s employees did not involve the bank’s mortgage division, which is the largest retail mortgage lender in the country, but “there will definitely be collateral damage on mortgage lending,” said Adam Deutsch, senior associate attorney at Westwood, N.J.-based law firm Denbeaux & Denbeaux.
“The CFPB didn’t quite talk about the number and type of customers who were affected, but this is information we are all looking out for, because if Wells Fargo opened accounts and made negative reports on consumers’ credit reports, this will create collateral damage that will impact both mortgage lending and other types of consumer lending,” said Deutsch, whose practice focuses on consumer rights litigation.
“If someone goes to get a mortgage loan, or an auto loan or a loan for their child’s college education, or even to refinance their home, they may find that their credit scores were negatively impacted by the bank’s actions.”
Considering recent reports that Wells Fargo may have fired employees who were involved in these practices as long as a decade ago, the impact to customers’ credit could be quite severe, depending on the amount of unpaid fees involved and how long ago the negative item first appeared on their credit report, Deutsch said.
“Most people will not even know they were impacted until they go to apply for some type of line of credit, and even then they may not know what their credit score really is,” he said.
Full article here…
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