In twist, Philly man sues bank over mortgage, wins
Associated Press
Wells Fargo had ignored the lawsuit filed by music promoter Patrick Rodgers, prompting Rodgers to win a $1,000 default judgment -- and the scheduled sheriff's sale of a Wells Fargo branch so he could collect.
The March 4 sheriff's sale got the bank's attention, and the two sides have now settled the suit, if not their differences.
"It seems to me they felt they're above the law," said Rodgers, who paid $180,000 in 2002 for his six-bedroom Tudor at the outskirts of the city. "It felt like the sheriff's sale was a little taste of justice for me."
The dispute, which The Philadelphia Inquirer has reported on, involves how much homeowners' insurance he must carry.
Rodger refinanced with Wells Fargo in 2004 and had long had the house insured for $255,000, he said. In 2009, his insurer told him that Wells Fargo was insisting he carry enough coverage to rebuild the house in the event of a catastrophe, he said.
An appraiser put that amount at just over $1 million. The insurance premium would quadruple.
So Rodgers read up on real-estate law, and eventually sued Wells Fargo under the federal Real Estate Settlement Procedures Act, known as RESPA. Among other things, he said, the act requires lenders to respond to customer queries and prohibits
"If mortgage companies are not treating (borrowers) properly, RESPA is a great tool in their arsenal," Rodgers, who declined to give his age, told The Associated Press.
Wells Fargo insists it never demanded he get $1 million worth of insurance coverage, but only enough to rebuild the home, according to Vickee J. Adams, vice president for communications at Wells Fargo Home Mortgage. The bank was not involved in the appraisal, she said.
Rodgers noted that many historic homes, especially in inner cities, are worth only a fraction of what it might cost to rebuild them, given original floors, windows and other period features.
Under the settlement, Rodgers will get the $1,000 default judgment, court costs and, according to Tuesday's Inquirer, which quoted Rodgers, an amount taken off his mortgage to reflect the time he spent on the case. Rodgers declined to confirm that detail, saying he had since agreed to keep some portions of the settlement private.
For now, Rodgers' home is insured through a program Wells Fargo uses when borrowers fail to secure coverage. The annual premium is $2,400. He has until June to find a cheaper policy, Adams said.
She blamed the bank's failure to respond to Rodgers' lawsuit on "a miscommunication."
"Clearly, we could have handled this better. However, we have done everything possible to resolve it," Adams said.
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