Problems with Wells Fargo Home Mortgage

[brtb]

Hi,

We are one year into our Ch. 13 plan and we pay our mortgage outside of the BK. Lately, I've been having some issues with Wells Fargo. We are technically current on our mortgage, but sometimes I can't make the payment until late in the month (after the 16th). They used to be pretty timely with applying out payment to the account; within 2 business days after the payment clears my checking account. Now, it's taking up to 2 weeks. The representatives are Wells Fargo seem so incompetent.

Here's an example: I paid our August payment on 8/17. They have not applied it to our account as the August payment; they think it's for September. I'm still waiting for these people to post my August payment. I don't know how to get through to them. They're holding the money in a suspense account. It's very frustrating....has anyone else has these types of issues.

Also, I pay online. I'm wondering if I should just make the payment at a branch.

Plus, I already know I won't be able to make our Sept payment until 9/28/12.

Thanks!

[Pandora]

I'm sorry you're having so many issues with your mortgage co., but i'm going to play devils advocate for a moment. Technically - you're late in paying - which is a breach of your Chapter 13 as well as the loan terms. You should never be late in paying any of your bills once you're in a Ch. 13, especially not your mortgage as they can request a lift of the stay. With that being said, it may be that you need to look over your situation in earnest since you state you will be paying your September mortgage payment on 28 September. That is a huge red flag that either you cannot afford your mortgage, your Ch. 13 payment may need adjusting, or... you arent budgeting appropriately.

Again, not wanting to sound harsh or mean (not my style) but just pointing out areas that need to be addressed. If you're falling behind in your house payment, the trustee can dismiss your 13. Are you sure you can afford to keep the house?

[brtb]

Pandora - Point taken. Thanks. I think I just need to re-adjust my budget where I get back into the habit of paying the mortgage at the beginning of the month and all of the other bills at the end of the month.

Thanks!

[Pandora]

Do you get paid bi-weekly? Weekly? monthly? two incomes?

How we do it is add up all the bills and their respective due dates - then divide them by 3 (number of paydays we get a month - military paydates of 15th / last day of the month). From there we know that X amount must be paid out of each payday, including whatever other bills we have that come up later in the year as well as incidentals (vet bill, car repair, savings, etc). We work it down equally so that we have the same amount left over each pay period until the following. So all the bills that are due the first 2 weeks of each month are actually paid the first pay period of the previous month (15th) - and whats due the middle of the month is paid out of the last pay day of the previous month. Make sense? That way we're never behind and have wiggle room.

Budgeting is hard - but once you get into a rhythm, it gets easier as you go along. We still use pen/paper / envelope method, that way I know i have X amount each month to each allocation - and I can do the budget up for the entire year.

Hopefully if you move some numbers around you will be able to get everything straight

[brtb]

Right now it's just my income; DH is unemployed, but hopefully that will change soon. I get paid bi-weekly. One paycheck goes directly to the mortgage. My second paycheck goes to all other bills (HOA, utilities, hospital bills, etc). It's a pretty strict cycle, but if something comes up my cycle gets flawed and the mortgage gets bumped. I was thinking that I was doing a good job just by paying the mortgage during the month it's due, but it's becoming obvious that I need to get better in paying it at the first of the month.

Hopefully, Wells Fargo will apply my August payment. Sadly, though when I called and spoke to a rep she said that I actually ahead a month, which I relentlessly tried to explain to her that I am not. I am still trying to get the August payment applied. It sucks.

[Pandora]

you could ask them for an account audit - which should place everything in a freeze of sorts. That way they can get it all straight so it wont show somewhere down the line that you're behind a month (because it will if they dont get it right).

i've been in that situation with our current mortgage lender and it took them forever to get it right.

Not sure if when you filed your husband had income, but if that was the case and he is now unemployed - have you adjusted your Ch. 13 to show that factor? Is there any wiggle room in the payment to unsecureds?

[brtb]

My husband was unemployed when we filed. Our monthly payment is extremely reasonable, so I really can't complain about that.

I was actually going through the payments with the representative because I was logged into my WF account while we were on the phone. I pay within the current month, but they are applying it to the next month. I seriously can't understand, though, why it's taking 3 weeks to apply the August payment that I made on 8/17. They don't have any trouble taking the money out of my checking account within one business day. To me the frustrating part is that they have my money; it's cleared my bank account and now it's sitting in a suspense account.

[brtb]

I just wanted to post an update in case it helps anyone or anyone can give me advice.

I previously said that I paid our August payment on 8/17/12. It was not applied to our account until today (9/12/12)!! After calling and complaining almost everyday an account manager finally stepped in and applied the payment while I was on the phone with a rep yesterday.

The reasoning....it had nothing to do with which date I actually made the payment. Like I said before they have no problem taking the money out of my account within one business day. I make my monthly payment online on the WF website and they excuse I got was that because we are in Ch. 13 the payments get applied to the account manually instead of automatically as they used to. They try to apply all payments withing 45 business days!!! Oh, but the kicker is I was told that if I want my payment to get applied faster I can make a payment over the phone, but it's a $20 fee.

Am I right to be frustrated with them? I know I'm in Ch. 13 for a reason, but I am making my payments on time (for the most part).

[Pandora]

45 days is outrageous and goes against WF's own direct debit practices of "no more than 3 business days".

Also - they have an ongoing theme of BK filers having issues; one particular case comes to mind (below)

http://www.q-law.com/slapdown-in-re-jones-v-wells-fargo-home-mortgage-inc/

In RE: Jones vs. Wells Fargo Case #03-16518


While the case is a bit different in its aspects - the actual PRACTICES of WF in how they deal with their customers who have filed BK - is apparently standard and a major issue. Misappropriation of payments / delays seem to be their M.O. - which is why I posted the case.

I'm assuming you have permission to talk / deal directly with WF from your attorney ??? If not, you need to get that - but you also need to let your attorney know what is going on so that he/she may assist in correcting the "45 day application" timeframe. Best bet is just to let your attorney deal with WF and have him/her fire off a letter, should that apply in your situation. Be prepared however that your attorney will more than likely scoff at you for paying late, regardless of WF's practice of holding payments for so long.

[brtb]

Thanks! I think will let my attorney know what's going on with them. I'll keep you posted.

[brtb]

Response from our attorney:

"I understand your frustration but there really isn't anything we can do about that, unfortunately. Sorry."

[Pandora]

I can tell you that if you are late (i.e,. over the grace period) - then the lender can hold everything in a suspense account until you have enough to cover whatever the amount is, which may result in you becoming behind in payments from their perspective. This is how they did it with loan mod trials since only some of the org. payment was being made. Once you get to that point (paying late) fees and penalties can be applied by the mortgage co, making it nearly impossible to catch up w/out demanding an account audit. The proof is going to be on you to prove - you cant say "but I made the payment w/in the grace period / they took it out w/in 1 day" because in reality, there is no real "grace period" on any loan (but there is usually always a penalty fee).

I can understand your attorney's comment but only if he's directing that from a "you paid late" standpoint (again devils advocate). Your attorney is probably gun shy at this point because technically you are late in paying, therefore WF can request a lift of the stay from a legal standpoint. However - if from this point forward you pay on time every month (i.e., not using the grace period as fee's get tacked on for paying late) then you would have recourse and - yes - from that point on your lawyer should do his job and ensure payment is credited w/in the lenders practices (i.e., same day / no more than 3).

if I'm wrong on this i'm sure one of the legal eagles will correct me

[brtb]

The curious thing is that even though I've been in the bad habit of paying after the grace period we have not incurred any late fees. Anyway, lesson learned.

[slim]

I pay online and it posts that day. There is no fee to pay online and it gives you a confirmation # to print out. It comes out of my checking account a couple days after that.

[chicagoed195]

You might also want to recheck the issue of the fee for payment by phone. My mortgage is with BOA and I have paid by phone every month I have been in Chapter 13. Somehow I have the impression the mortgage company is not allowed to charge a payment fee while you are in an active Chapter 13. I could be wrong. I often am.