WTF, Wells Fargo?! You’re a Terrible Bank. (part 2)

Go back to part 1.

The story of how badly the mortgage on our first home was mishandled by Wells Fargo will make you weep. Well, maybe not, but it will probably make you not want to use Wells Fargo for your next home mortgage. If there is any semblance of an excuse on the part of WF for this debacle, it’s that the timing was unfortunate: we got our mortgage just as banks were tightening up their regulations after the economy started tanking earlier that year (2009). Even now, though, Wells Fargo continues to piss us off regularly.

The process started without much of a hitch. We had confidence in our chosen lender. They had us sign a “Closing Guarantee,” a gimmicky document whose purpose was to put us at ease by promising to pay our first mortgage payment if they missed our closing date. Here’s the short version for those of you who are too impatient to get bogged down with the details:

Wells Fargo missed our closing date. Whether this was due to the incompetence of the people working on our loan, inadequate training of its staff following new internal policies, or a combination of both, the bottom line is that WF screwed us royally. They caused us plenty of undue anxiety, money, and time. When we finally closed a week late, they spent several months trying to renege on their “Closing Guarantee.” It took us sending a letter to the Better Business Bureau to finally get them to honor their own agreement.

The letter itself describes in detail what happened. I included a detailed timeline of events and pertinent documents in the original complaint filed with the BBB. Those are not included here for the sake of brevity. I have also redacted actual figures. Other than that, this is pretty much verbatim what we sent to the BBB. You wouldn’t believe how quickly this all got resolved once we did so.

July 9th, 2009
To Whom It May Concern:
I am writing to file a formal complaint regarding Wells Fargo Bank due to its gross mishandling of our home mortgage loan.
My wife and I have been loyal Wells Fargo customers in good standing for over 6 years. When I incorporated my solely owned business in 2007, I chose to bring that business to Wells Fargo as well. At the time of the incident, we had 2 personal checking accounts, 1 personal savings account, 1 personal credit account, 1 business checking, and 1 business credit account with the bank, all in good standing. We are first time home buyers and thought that going with Wells Fargo would be the most expedient and painless path to our first house. We were mistaken.
On January 27th, 2009, my wife and I received the “Wells Fargo Closing Guarantee” upon credit approval for our mortgage loan in the amount of $xxx. We read it, received a verbal summary of its contents from our mortgage specialist, and subsequently signed a document stating that we had received and understood the guarantee. On the same day, the final signed contract between us (the buyers) and the sellers of the property was furnished to and accepted by Wells Fargo – more than a month in advance of the expected closing date. The contract included a lease addendum through which the sellers would lease the property from us for $x per day for 4 days ($x) while they moved into their next home. We also furnished Wells Fargo with all the financial documentation that was requested of us at the time. We were given verbal confirmation that there was ample time to process the loan.
Everything appeared to be in order until the week leading up to the expected closing date. We requested a meeting for February 25th with our Wells Fargo mortgage specialist on our own initiative in order to ensure that we were ready to close. At this time it was brought to our attention that the bank’s appraisal had not yet occurred. Further, we were informed that we had been locked in to a higher than expected interest rate without our consent, and that we would have to pay $x to buy in to our desired rate. During the week leading up to the expected closing date, every transaction we made and had made in 3 months prior was closely scrutinized. We provided all the documentation that was requested of us within 24 hours of its request without exception.
Wells Fargo was unable to provide the necessary documents to the title company that was facilitating the transaction on our expected closing date of March 4th. Wells Fargo insisted throughout the day that we would still be able close all the way up until our scheduled time of closing. The sellers arrived at the title company ready to close only to find that it was not going to happen. Needless to say, we were very upset. When it was clear that we would not close that day, I called our Wells Fargo mortgage specialist and received verbal confirmation from him that Wells Fargo would honor its Closing Guarantee by refunding us our first mortgage payment. My wife was sitting next to me and can corroborate the details of the conversation.
We were not able to close until March 12th, over a full week after our expected closing date – all solely on account of Wells Fargo. During this week, we provided all documentation that was requested of us in a timely fashion. We experienced undue stress and embarrassment, not knowing whether all the work we had put into the purchase of our first home was in vain. We felt as though we were under criminal investigation as Wells Fargo further scrutinized our finances, including our financial security and my right to pay myself on behalf of my business, of which I am the sole owner and only employee.
The sellers demanded that we waive their lease fees due to their inconvenience, which resulted in a loss of $x. Further, we lost an estimated $x in utilities which had already been transferred into our name in anticipation of our March 4th closing date. There were also less quantifiable losses. I was unable to work at full capacity during this time due to the stress and daily duties of providing additional documentation  to Wells Fargo. I was unable to attend a class on one occasion because I anticipated closing on the same day and did not think I could get back in time to do so.
Nearly all of our financial accounts are with Wells Fargo, yet we found ourselves being asked to prove things that not only should have been asked weeks in advance of our expected closing, but also could have easily been ascertained by Wells Fargo itself by simply looking at our accounts and the documents that they already had on file. It was only after our final plea, which included a summary of our financial viability to receive the loan and a threat to use another mortgage broker, that Wells Fargo finally relented and provided the necessary documents to the title company.
We closed on March 12th and moved into our new home on March 16th. We dutifully paid our first mortgage payment. On April 17th, I contacted Wells Fargo to inquire as to whether it would honor its Closing Guarantee. Over the course of the following month, I contacted Wells Fargo several more times but did not receive an indication that a decision had been made regarding the matter until May 20th. At this time, I was informed that Wells Fargo had decided to renege on its own Closing Guarantee in spite of the fact that we had fulfilled every requirement in the document. Further, I was told that there was no way to appeal this decision. It was relayed to me that the reason for the decision was that our loan was denied and then subsequently revived during the week between our expected and actual closing dates. Wells Fargo claims that this provides adequate justification for its decision. I disagree.
Nonetheless, we offered Wells Fargo the chance to rectify the situation. On May 27th, I drafted a version of this letter and sent it to Wells Fargo, giving them until June 2nd to reverse the decision before I sent it. This was the first time I observed any sense of urgency to resolve the matter on their part. By the following Monday, I received word that the decision had been reversed, but that it would take 3 to 4 weeks for the check to be mailed. A week or so later, I received written confirmation that the guarantee would be honored and our first mortgage principal and interest would be refunded to us in the amount of $x. In spite of this written confirmation, we have yet to receive a check from Wells Fargo for the promised amount. It has now been over 4 months since Wells Fargo missed our closing date. We have made 3 mortgage payments on time. Wells Fargo has yet to fulfill its written guarantee. This has added insult to injury.

Wells Fargo did finally make good on it’s “Closing Guarantee,” and we have been dutifully paying our mortgage without a hitch ever since. That is, until we recently refinanced because we found a much better rate. Then Wells Fargo pissed us off again.

Go to part 3.

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