Wells Fargo responds to N.Y. AG foreclosure comments

NEW YORK (Legal Newsline) - A representative for Wells Fargo responded on Wednesday to remarks made by New York Attorney General Eric Schneiderman related to foreclosure relief in New York in the wake of Hurricane Sandy.

Tom Goyda, the vice president of corporate communications at Wells Fargo, said that Schneiderman's office misinterpreted the lender's actions. The company is currently attempting to clarify the facts of the situation with Schneiderman's office.

Wells Fargo began to suspend all foreclosure sales in Federal Emergency Management Agency-declared disaster areas immediately after the hurricane made landfall. The suspension of any foreclosure activity in the disaster areas will last at least 90 days for loans Wells Fargo owns and services. Loans serviced for other companies, such as Ginnie Mae, Fannie Mae and Freddy Mac, will follow particular investor guidelines.

Additionally, all eviction actions in the disaster areas were suspended and the policy will be reviewed again in January.

Foreclosure sales, new foreclosure referrals and evictions were suspended when the storm hit landfall.

"We are trying to do what is right by the customer, we want them to talk with us, call us and help us learn their circumstances so that we can work with them to reach the best options possible," Goyda said.

On November 16, Schneiderman warned Wells Fargo to reverse a purported policy to temporarily suspend mortgage relief application reviews for homeowners in New York. He alleged that the bank's directive was in violation of the National Mortgage Settlement.

"Wells Fargo is not excused from any of its obligations under the National Mortgage Settlement or under New York law as a result of Hurricane Sandy," Schneiderman said. "My office will aggressively pursue any loan servicing company that uses this tragic event as an excuse to violate loss mitigation decision timelines."

The Mortgage Settlement Agreement was reached in March with Wells Fargo and four other major mortgage servicing companies. The agreement required lender compliance with multiple servicing reforms, including fast review and response timelines for borrowers seeking mortgage modifications and other relief.

"Countless families in New York have suffered tremendously because of this natural disaster," Schneiderman said. "As we work to help those affected rebuild their lives, my office expects Wells Fargo's full cooperation in ensuring that no additional and unwarranted damage is inflicted on those who were victims of this tragic event."