Wells Fargo Resolves Mortgage Claims by Eight States
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Wells Fargo & Co. agreed to pay $24 million to eight states and make more than $772 million in loan modifications to resolve allegations that companies it acquired deceptively marketed adjustable rate mortgage loans.
The states claimed Wachovia Corp., which bought World Savings Inc. and was then acquired by Wells Fargo’s home mortgage unit in 2009, left consumers with massive debt by failing to give proper warning of the effect “pick-a-payment” adjustable rate mortgages could have. The low payment options often didn’t cover monthly interest, leading to defaults and foreclosures, the states said.