Wells Fargo’s Foreclosure Manual under Public Scrutiny

by San Antonio Attorney

Wells Fargo is under fire over claims that it created a manual for falsifying documents to validate property foreclosures.

Bankruptcy lawyer Linda Tirelli has discovered a 150-page in-house manual that she says details the procedure for the bank’s lawyers to ask retroactive records that another loan provider has signed for a loan to the bank. This type of documentation, referred to as an endorsement, is required to show that Wells Fargo is now the owner of the loan and has the authority to foreclose on the homeowner.

According to Wells Fargo spokeswoman Vickee Adams, the guide is for outside lawyers to be up to date with the regulatory requirements.

Having examined the document, Trelli said it indicates that Wells has been falsifying proof of ownership. While homeowners have been objecting foreclosures on the grounds of flawed documents for many years since the housing market crashed, the bank’s manual offers an elusive opportunity to check the lender’s foreclosure procedures when they do not have the paperwork.

Before the housing crash, countless numbers of mortgage loans have been moved in the craze to securitize that loan companies oftentimes lost, or failed to make, paperwork of transfers in ownership. Further complicating this, a lot of original loan providers went bust.

The robo-signing problem, which shook the mortgage industry four years ago, provides reason to question the reliability of Wells’ internal assessments, said Jim Kowalski, an attorney in Florida who represents homeowners. He also noted that regulators have uncovered many mistakes in the foreclosure procedures of the country’s five biggest banks, including Wells, before they made a deal to reform their practices.

Another consumer bankruptcy lawyer, O. Max Gardner, said the guide is an evidence of the faults in the documentation process of Wells Fargo.

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