Approximately 60,000 military members who refinanced their VA mortgage loans through Wells Fargo, Wachovia, and SouthTrust are set to receive refunds totaling $10 million after a class action lawsuit filed in Georgia was settled.
“Those who may be eligible refinanced their loans between January 20, 2004 and October 7, 2010,” said Wells Fargo spokeswoman Vickee Adams. “The refunds will be $175 per loan; some service members and veterans may have refinanced more than once during that time.”
On January 20, 2009 a class action lawsuit was filed against Wells Fargo in Georgia after the bank was accused of improperly combining attorneys’ fee with expenses such as title searches. According to VA rules, lenders are responsible for covering attorney fees, not the borrowers, which is why thousands of veterans and active duty service members are now entitled to a refund.
Military members who are eligible to receive the refund will be receiving a letter notifying them of their eligibility within the following month. These letters will inform military members about how to apply for their refund and will provide additional information regarding their refund.
“After a long battle, and hard-fought negotiations, we are glad to reach a settlement we think is fair and adequate for veterans,” stated Clay Fuller, a lawyer of Daughtery, Crawford, Fuller and Brown of Columbus, Georgia.
VA loans that were refinanced through Wachovia and SouthTrust during will also be eligible to receive the $175 refund as SouthTrust merged with Wachovia which then merged with Wells Fargo.
“Since the lawsuit allegation was raised, we have diligently worked with our veteran customers who inquired about their fees, and we refunded them if there was an error in the third-party charges that were assessed,” stated Cara Heiden, co-president of Wells Fargo Home Mortgage in an email. “We hope that by settling this matter, we can demonstrate to veterans our steadfast commitment to doing right by them.”
Heiden further stated that “Historically, the required mortgage loan closing documents have not clearly lined up with the VA rules so it is difficult to separate the charges detailed in those documents. Wells Fargo has been working with the Department of Housing and Urban Development to improve that process for the entire industry.”
Photo thanks to Carly Jane1 under creative common license on Flickr.