Wells Fargo Expands Relief Programs for Mortgage Payments
In an attempt to contain the number of foreclosures across the United States and keep as many borrowers as possible in their homes, Wells Fargo and Company announced over the weekend that it would continue to expand the use of the federal Home Affordable Modification Program (HAMP) and other relief programs.
“From the beginning, our goal has been to work with our customers to avoid foreclosures wherever possible while balancing the interests of the 92 percent of our customers who continue to stay current in their payments,” explained Mike Heid, Wells Fargo Home Mortgage’s co-president. “When a viable alternative exists, there is no incentive for us to go to foreclosure sale. It doesn’t benefit us, our customers, communities, our shareholders, or our investors.”
Heid insisted that Wells Fargo is doing everything possible to help mortgage modifications progress. For example, the lender has lengthened the trial period for HAMP participants currently making reduced payments but who have not yet submitted the requisite documentation.
From January 1 to November 30 of 2009, Wells Fargo had 422,001 active trials and finished modifications set up. Of that number, 99,674 were modifications associated with HAMP. For each foreclosure sale of properties occupied by owners in November, Wells Fargo began or finished three modifications, relying on both HAMP and non-HAMP modification programs.
Of the 99,674 active HAMP trial beginnings and completions, about 56,000 have not yet paid all three of the trial payments because the third trial payment of most participants has not yet come due. According to Wells Fargo, 44,000 of its HAMP participants have paid each of the three trial payments as of Nov. 30, and about 40 percent of these borrowers already have or are ready to switch to a final modification, which includes the 3,537 finished modifications reported by the federal government.
For Wells Fargo customers who cannot qualify for HAMP or whose trial HAMP modifications were cancelled, Wells Fargo has successfully reduced mortgage payments substantially through its in-house mortgage modification program. The bank’s Wachovia “pick-a-payment” mortgage program has effectively addressed the singular nature of the negative amortizing Wachovia loans with a blend of rate and term modifications and principal balance forgiveness.
As the severe recession continues to powerfully affect communities and individuals, Wells Fargo remains strongly committed to considering every option to keep customers in their homes. The bank said that it will also continue working with the United States Department of Treasury on modifications to HAMP, thus allowing it to adapt to the evolving economy and the concomitant challenges that economy has thrust upon many American households.