Wells Fargo & Co. (NYSE:WFC) reported today that between March 1, 2012 and Sept. 30, 2012 the company assisted more than 45,000 homeowners through expanded modifications, other customer relief options, and refinances under the National Mortgage Settlement. As a result, Wells Fargo has fulfilled an estimated 52 percent of its $4.3 billion national consumer relief and refinance commitment in the first seven months of implementation and remains on track to complete its entire commitment in the required time frames.
“Wells Fargo has made significant progress toward the fulfillment of its commitments under the National Mortgage Settlement while continuing to serve all of our customers who need assistance or are looking to refinance,” said Michael DeVito, executive vice president for Default Mortgage Servicing at Wells Fargo Home Mortgage. “Overall, we currently have more than 812,000 customers benefiting from modifications started since January 2009 and during that time also have completed more than 4.4 million refinances allowing borrowers to take advantage of lower interest rates.”
Details on the expanded modifications, other consumer relief options, refinances and national servicing standards under the settlement were included in the first scheduled report to the Office of Mortgage Settlement Oversight. The report to the monitor included national data, as well as a state-by-state breakdown of consumer relief and refinance activities.
The company also indicated that it implemented all of the servicing standards required under the settlement on schedule by Oct. 2, 2012, and was performing appropriately on the nine metrics included in the current report.
“Implementation of all of the national servicing standards is a significant step forward in our ongoing efforts to restore confidence in the mortgage servicing industry,” DeVito stated. “Thanks to exceptional work by more than 1,000 team members, we’ve embraced a new way of operating the business that improves our operational effectiveness, creates greater transparency and enhances our risk management.”
The report released by the monitor can be viewed here. National consumer relief and refinance program totals appear in the table below:
|Program||Customers Helped||Consumer Benefit1|
1st and 2nd lien trial and completed
|12,4302||$1.1 billion in principal forgiveness2|
Short sales and deeds-in-lieu of
|12,872||$1.3 billion in write offs of indebtedness|
|Other consumer relief activity||4,300||$33 million in write offs of indebtedness|
|1st lien refinances||15,453|
$588 million in total interest savings
($4,848 in average annual interest
savings for each customer
1 Dollar amounts include a portion of the gross consumer benefit provided and do not reflect the amount of credit toward Wells Fargo’s financial commitment. The credit applied to the commitment will be determined by a formula that takes into account the amounts here as well as other factors.
2 Includes completed 1st lien modifications and completed 2nd lien modifications from interim report to the OMSO, plus active trial modifications in place as of Sept. 30, 2012. Active trial modifications included are not directly comparable to trial modifications listed in the report to the OMSO.
3 Reflects $2.9 billion in UPB refinanced with an average note rate reduction of 2.63% resulting in total annual interest savings to customers of $75 million and $588 million in total interest savings to customers over the 7.85-year anticipated average life of the refinanced loans.
“The expanded modification and refinance programs clearly are providing meaningful relief and payment reductions to borrowers,” added DeVito. “The first-lien modifications started and completed to date have reduced monthly payments, on average, by more than 43 percent and the refinances completed have resulted in average principal and interest payment reductions of more than $400 per month.”
The geographic distribution of Wells Fargo’s consumer relief and refinance activities remains consistent with the distribution of its portfolio and also reflects the fact that the financial commitments under the settlement are focused on borrowers who are in a negative equity position.
The results in the report indicate Wells Fargo is on track to complete the number of refinances necessary to satisfy the entire credit in the first 12 months of offering the refinance program, and to meet its commitments on the modification and other consumer relief programs within the required timeframes, as the company had estimated in previous disclosures. The progress to date reflected in the report regarding the refinance program is consistent with what the company has previously disclosed in terms of the number of customers expected to be refinanced through the program and the financial impact.
About Wells Fargo
Wells Fargo Home Mortgage is the nation’s leading mortgage lender and services one of every six mortgage loans in the nation. A division of Wells Fargo Bank, N.A., it has a national presence in mortgage stores and banking stores, and also serves the home financing needs of customers nationwide through its call centers, Internet presence and third-party production channels. Wells Fargo Bank, N.A. is an equal housing lender.
Wells Fargo & Company (NYSE: WFC) is a nationwide, diversified, community-based financial services company with $1.4 trillion in assets. Founded in 1852 and headquartered in San Francisco, Wells Fargo provides banking, insurance, investments, mortgage, and consumer and commercial finance through more than 9,000 stores, 12,000 ATMs, the Internet (wellsfargo.com), and has offices in more than 35 countries to support the bank’s customers who conduct business in the global economy. With more than 265,000 team members, Wells Fargo serves one in three households in the United States. Wells Fargo & Company was ranked No. 26 on Fortune’s 2012 rankings of America’s largest corporations. Wells Fargo’s vision is to satisfy all our customers’ financial needs and help them succeed financially.