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Wells Fargo reporting Delinquency after foreclosure without a judgment

Discussion in 'Wells Fargo Home Mortgage' started by needhelpGA, Jan 14, 2014.

  1. needhelpGA

    needhelpGA LoanSafe Member

    Hello all, I am new to this forum. I am so glad to have found this forum.

    I am currently going through a very difficult credit reporting error by Wells Fargo Home Mortgage (WFHM). Here is what happened to me. I had a foreclosure in 12/2010. WFHM did not file for or receive deficiency judgment within 30 days or for that matter just did not file any deficiency. A year later in 10/2011 I got bad advice from an attorney to file chapter 7 just in case the Wells Fargo came after me for garnishment. So I filed for chapter 7 even though I should not have. Later I got my job back and my credit score is right at 703 (FICO). The bank said I can qualify for a FHA mortgage now because it has been 3 years from foreclosure and 2 years from bankruptcy. So we pulled the credit report and to my surprise WFHM had put date of latest delinquency as 10/2011. This ruined my chance of getting a house this year i.e., in 2014. My question is, if there was no deficiency, how come there is delinquency, even if WFHM was included on Schedule F of Chapter 7 bankruptcy? I called WFHM and they did not know why I would be delinquent since the property was sold back to the bank and in Georgia (OCGA 44-14-161) there cannot be any deficiency if it was not granted by the court. So I wrote a letter to WFHM and they said they will review it and get back to me. It's been two months now. How long do I have to wait for their answer? I just mailed letters to three Credit Bureaus to correct the mistake, since WFHM did not bother to correct it. How long do I have to wait for the correction? Will it be corrected or am I wrong? Any answer will be greatly appreciated. Thanks.

    Is there anyone else on this forum going through the same problem with WFHM?
    Last edited: Jan 14, 2014
  2. TomEason

    TomEason LoanSafe Guide


    I just responded to your post in another thread.
  3. needhelpGA

    needhelpGA LoanSafe Member

    Thank you sir for your response. I accidently posted in the wrong thread I believe. My apologies.
    Yes I have FCRA and O.C.G.A 44-14-161. Reading both of these, it seems I am correct. Then why won't WFHM correct the error. I have the county tax records showing bank sale date with $0 balance. What can I do to have my credit report corrected or really what can I do to be pre-approved for a mortgage. I have good employment history, good credit, verifiable income and last two years tax records with increasing income. I am interested in a FHA mortgage.
  4. TomEason

    TomEason LoanSafe Guide


    Thanks for your post.

    Per the provisions of the FCRA, if WFHM doesn't comply they can be both fined and sued by you.

    I recommend you write WFHM again, and include the requirements under the FCRA. State that if they don't comply, you intend to take legal action.

    I recommend you consult with at least two experienced lenders / loan brokers who have FHA programs.
  5. needhelpGA

    needhelpGA LoanSafe Member

    Thank you Tom for your assistance. I have retained an attorney. I have decided to not to take it lying down. I am going to bite back. I am ready for a fight.

    A similar case in Virginia. Do I need to file bankruptcy after foreclosure? |Robert Weed
    If it is allowed by the moderators of this forum I can post the progress of my plight caused by WFHM and other pertinent information so others who are in he same situation will have most of the information compiled in one place.
  6. Jeffrey L. Shurtliff

    Jeffrey L. Shurtliff LoanSafe Member

    If you filed the BK after the foreclosure then the foreclosure and the deficiency will be on your credit record. Filing BK should have removed the deficiency from your report. If they still have the deficiency reporting on the last date of 10/ 2011. They might not have to remove it as there was no bankruptcy until 10/2011. The BK 7 should have been filed before the foreclosure if at all.
  7. needhelpGA

    needhelpGA LoanSafe Member

    Thank you for your response. You are absolutely correct that’s how it happens in most states, except Georgia. This perhaps is the premises of the error by WFHM in this case. But, this error should not be taken lightly. Isn’t there a training requirement for employees (FCRA Section-609 [1681g])? If you do business in Georgia, you must know the Georgia laws. Not knowing the law is never an excuse. Please keep the responses coming.

    Here is the caveat. Georgia is one of the states that allow a non-judicial foreclosure. Once the property is repossessed [foreclosed] by the bank and the bank buys it back (called the “credit bidâ€) and the sale is filed with the county tax assessor’s office the bank is considered paid in full unless and until there is a deficiency judgment granted by the judge of the superior court of the county where the property is located [O.C.G.A 44-14-161]. In Georgia the lender has 30-days to file for deficiency. If not filed within 30-days the lender does not have a deficiency (cannot file it at a later date) and without deficiency there is no delinquency. Passing along the knowledge as I am learning so others can benefit.

    The Georgia confirmation statute, enacted in 1935, is now codified at O.C.G.A. § 44-14-161:
  8. Evan Bedard

    Evan Bedard Call 1-800-779-4547 Loan Safe Mortgage

    I definitely agree with both Tom and Jeffrey. One thing I have come across on many occasions is people looking to purchase a new property post-foreclosure who don't know the exact date the foreclosure occurred, especially if you vacated the property before the auction. Some people confuse general foreclosure notices with actual sale dates and just yesterday I spoke with a gentleman who had a foreclosure nearly two years after he thought it was finalized. Also, I'm very sorry to hear your attorney convinced you to file BK to prevent a possible deficiency judgment as we've found them to be very rare in any state..
  9. needhelpGA

    needhelpGA LoanSafe Member

    Mr. Evan Bedard, so nice of you to chime in and also, thank you sir for your kind words about Bk 7.
    Yes sir, I am on top of it with all paperwork in hand. I have the copies of the sale dates and tax records from the county tax assessor’s office. Copies of the deeds with filing stamps from the county records office. I am well organized and ready for long drawn out battle if it comes to that.

    My goal is to make it easy for those who follow behind me in similar situation.
  10. needhelpGA

    needhelpGA LoanSafe Member

    At the moment it seems we are making progress on this case.
    Question – Does anyone know of an experienced Underwriter and/or an experienced Mortgage broker in the metro Atlanta area?
  11. needhelpGA

    needhelpGA LoanSafe Member

    Success at last!

    This is how it works in Georgia.
    After foreclosure the Bank has 30 days to file a Deficiency Judgment. Then a judge decides if there is a deficiency. If the bank does not file a deficiency within 30 days then there is no deficiency and absolutely no delinquency can be reported. If a delinquency is reported it is in Error and must be corrected. Reapplying for mortgage, the clock starts from the Bank Sale date. You can look this date up at the ‘County Tax Assessors’ office or website. If the previous loan was also an FHA loan then you MUST start your 3-year clock from the date FHA paid the claim to the bank that held the mortgage. This usually happens about a month after the foreclosure sale date. Technical term for clean slate is “clean CAIVRS†which stands for, “Credit Alert Verification Reporting System.â€

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