Virginia Association of Housing Counseling Patricia Scott AVP, Community Outreach Consultant Wells Fargo Home Mortgage Consumer Lending Group, Community Relations and Outreach Hampton, VA May 5, 2015 We want to satisfy all our customers financial needs and help them succeed financially. Wells Fargo & Co. vision 1 Achieving our vision through Wells Fargo Real Estate Lending When it comes to helping consumers as they work to achieve homeownership, For example, we do this through: Wells Fargo Real we have a clear goal. Estate Lending National accessibility call centers, online plays a significant channels, and more than 8,700 Wells role in Fargo stores implementing the Assigning one home mortgage specialist company vision of to help a customer from beginning to end helping our customers succeed Home Preservation events (where financially and customers can receive financial education sustaining and possible loan modifications or homeownership. repayment plans) and down payment assistance programs 2 1
Wells Fargo Real Estate Lending The Wells Fargo Leading the Way Home program The Wells Fargo Leading the Way Home program is an enterprise-wide effort that helps communities stabilize their current housing situation while advancing homeownership to build strong communities. The program helps us achieve our vision through: Responsible lending/servicing Education and outreach Home preservation and foreclosure prevention Property preservation and sales Grants and programs offered by the Wells Fargo Housing Foundation 3 Customer outreach When payment challenges arise, customers should always contact their servicer first, using the phone number on their mortgage statement. Wells Fargo tries to contact customers through our own and national sources: Home Preservation events Single Point of Contact (SPOC) Customer calling/direct mail campaigns Dedicated Community Outreach team and nonprofit partners 4 Single Point of Contact (SPOC) model We proactively adopted in 2010 an enhanced Single Point of Contact model for customers who are pursuing mortgage payment assistance to avoid foreclosure. Specifically, SPOC: Improves customer communications and the customer experience. Establishes an assigned team member to serve as the point of contact for the customer. Eliminates the need for the customer to re-tell his or her story. Ensures clear communication is provided to keep the customer informed of his or her loss mitigation application. Provides an advocate to ensure that any internal obstacles are removed to further the customer s application. Works with the customer on foreclosure alternatives if a modification is not approved. 5 2
Finding appropriate sustainable options As we identify options for our customers, we need to ensure they are sustainable over the long-term. Making Home Affordable is just one of the modification options available. Priority of actions to achieve objectives 1. HAMP 2. In-house modification program 3. Unique case-by-case modifications 4. Home sale assistance 5. Quality review for all cases before foreclosure sale Not all customers, even if their loan is modified, will be able to continue making payments on time. The key factors that drive re-default are: Debt-to-income ratios (DTI above 38%/TDTI above 55%) Post-modification monthly surplus below $300 Post-modification payment increases Stretched affordability coupled with no equity 6 Refinancing and loan modifications Wells Fargo is a leader in offering refinancing options and modifications on existing loans. We are the numberone refinancing lender, with 15.0% of the market share.* *Inside Mortgage Finance, October 31, 2014 ranking reflects data YTD 2014 Since January 2009, Wells Fargo has helped 9.8 million homeowners with new low rate loans to refinance an existing mortgage. We refinanced more than 1.59 million loans through the Home Affordable Refinance Program (HARP), including more than 647,771 borrowers with LTVs greater than 80% since HARP launched in April 2009. Since January 2009, we ve been involved in over 1 million active trial and completed modifications 85% through Wells Fargo, 15% through the Home Affordable Modification Program (HAMP). 7 Foreclosure prevention Wells Fargo has been a leader in preventing foreclosures, where possible. We view foreclosure as a measure of last resort, and have put controls in place to ensure reviews are conducted on every loan. When customers choose to work with us, we help 7 of 10 avoid foreclosure. 1 For those who choose to manage the challenges on their own, only 1 of every 3 avoid foreclosure. 1 Over the last 12 months, less than 1.0% of the owner-occupied properties in our servicing portfolio have actually proceeded to foreclosure sale. 1. Data from WFHL Current Stats January 2009-October 2014 2. Source: Inside Mortgage Finance, Nov 21, 2014, and MBA National Delinquency Survey 3Q14, Nov 14, 2014 8 3
Wells Fargo continues to make every effort to keep people in their homes through programs focused on mortgage payment relief. option Refinance Repayment plan Modification Description Allows new loan on the property with no change in ownership to pay off the existing loan Distributes delinquent payments over a period of time, usually no more than 12 months; monthly amount added to usual mortgage payment Changes one or more terms of the mortgage, including term extensions, rate adjustments, and/or principal forbearance or forgiveness, where allowed 9 (cont.) Wells Fargo continues to make every effort to keep people in their homes through programs focused on mortgage payment relief. option Partial claim Forbearance Description Advances a loan from HUD to repay the pastdue interest and escrow amounts Partially or fully suspends monthly payment for a period of time; because of long-term implications, used in severe hardship cases 10 Federal government programs Wells Fargo also uses federal government programs to assist customers with mortgage payment relief. Home Affordable Modification Program (HAMP) for customers delinquent or struggling to keep current on their mortgages Home Affordable Refinance Program (HARP) for customers current on a mortgage owned by Fannie Mae or Freddie Mac Home Affordable Foreclosure Alternatives (HAFA) for customers unable to retain their home under HAMP 11 4
Wells Fargo modification programs Wells Fargo strives to help customers achieve and sustain homeownership through its own proprietary modification programs: Payment reduction modification Mortgage assistance program Case-by-case modification program 12 COC/AM roles Community Outreach Consultant Account Manager Conduct regular pulse checks regarding interaction with Wells Fargo Regular non-profit performance review Promote upcoming events or forums and recommendations for future events Field requests for HLP training Field requests for any loan modification package submission training Build relationships with non-profit agencies not already working with Wells Fargo Attend forums to discuss and present Wells Fargo servicing topics Relationship roles and responsibilities of COC & Account Managers to non-profits Hope Loan Portal Modification workout options Feedback to/from the WF servicing units Default Servicing process flows and challenges Monitor the relationship between the nonprofits and the Wells Fargo operational areas (Account Managers) attend on-boarding, new non-profits (when possible) attend regular Account Managers pipeline review meetings with Non-profits (when possible) attend Non-profits training requests (when possible) Schedule and facilitate monthly review of escalation status with Account Managers Virtually Non- Profits Agencies training ERCP and HLP Portals Loss mitigation documents Pipeline reporting, analyses, review and escalation Monthly overview detailing volume, approval ratio, cycle time s and compensation Monitor the relationship between the nonprofit agencies and the Wells Fargo operational areas Regular pipeline reviews Escalation resolution Provides initial submission quality results Mutual collaboration Promote our CHA and Account Manager groups in the market Schedule and facilitate monthly conference call with Non-profits/Account Managers (optional) Shared Activities Escalation resolution New Agency On-boarding Requests for additional support (e.g. training or in-market) 13 5