Wells Fargo COVID Forbearance Settlement: $185M

Individuals are eligible if they had a Wells Fargo-serviced mortgage placed into forbearance without their informed consent between March 1, 2020, and December 31, 2021.

Documentation such as refinancing documents, credit denial letters, or other lending documents may be required to support claims.

Wells Fargo has agreed to a $185 million settlement to resolve claims that it placed mortgage loans into COVID forbearance without obtaining informed consent. The settlement benefits individuals whose Wells Fargo-serviced mortgage was placed into forbearance between March 1, 2020, and December 31, 2021, without their explicit request.

The class action lawsuit alleges that Wells Fargo provided mortgage forbearance to customers during the COVID-19 pandemic without their consent. Plaintiffs claim that these unwanted forbearances negatively impacted borrowers’ credit reports and caused financial hardship.

Forbearance temporarily suspends mortgage payments, but the lawsuit argues that some borrowers neither requested nor wanted this relief. Wells Fargo, a major home loan provider, denies any wrongdoing but agreed to the settlement to resolve the claims.

Under the terms of the settlement, benefits include:

• Automatic Pro Rata Payments: Class members will receive a pro rata share of the first $69 million of the settlement fund. Co-borrowers may receive an additional $83.33. Any remaining funds may result in further pro rata payments. These payments will be made automatically without the need to file a claim.
  
  
• Supplemental Payments: Class members who experienced additional harm due to the forbearance can file a claim for further compensation. These supplemental payments may cover:
  • Delayed refinancing
  • Increased refinancing costs
  • Credit denial
  • Lost income, and more

Class members who wish to claim compensation for additional damages must submit a valid claim form by January 10, 2025.