Home / Business and Economy / Wells Fargo Settles $56.85M Credit Score Lawsuit
Wells Fargo Settles $56.85M Credit Score Lawsuit
19 Feb
Summary
- Wells Fargo agreed to a $56.85 million settlement.
- Lawsuit alleged improper reporting of mortgage forbearances.
- California homeowners with Wells Fargo mortgages may benefit.
Wells Fargo will pay $56.85 million to settle a class-action lawsuit alleging harm to customer credit scores during the COVID-19 pandemic. The bank, while not admitting wrongdoing, reached the agreement after claims of violating the Fair Credit Reporting Act.
The lawsuit contended that Wells Fargo inaccurately reported mortgage forbearances, which allow payment pauses for financial hardship, to credit bureaus. This alleged misreporting occurred despite the CARES Act's intent to protect borrowers' credit scores by ensuring forbearance accounts were reported as current.
Eligibility for the settlement is limited to property owners in California with a Wells Fargo mortgage who received a CARES Act forbearance on or after March 27, 2020. Their accounts must have been current and reported as in forbearance.
A judge in San Diego, California, is scheduled to rule on the settlement's approval on April 17. Affected customers could receive payments if the settlement is approved. Objections must be filed by March 25, 2026.
