Alejandro Carrillo v. Wells Fargo Bank, N.A.
Buydown Settlement
Case No. 2:18-cv-03095-PKC-JMW

Frequently Asked Questions

 

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  • The purpose of the Legal Notice by Order of Court ("Notice") is to let you know that a proposed settlement has been reached in a class action case entitled Alejandro Carrillo v. Wells Fargo Bank, N.A., Case No. 2:18-cv-03095-PKC-JMW, pending in the U.S. District Court for the Eastern District of New York. The plaintiff has alleged that: (1) Wells Fargo violated the federal Truth in Lending Act, 15 U.S.C. § 1601 et seq. (“TILA”) by improperly disclosing the interest rate that would be applied to a customer’s loan while their Buydown Agreement was in effect; (2) Wells Fargo’s method of applying interest to a customer’s loan breached the terms of the customer’s Buydown Agreement; and (3) the disclosures Wells Fargo gave customers in connection with their Buydown Agreement were in violation of state consumer protection statutes. Wells Fargo denies Plaintiff’s allegations and denies that it did anything wrong. The Court has not decided who is right.

    You have legal rights and options that you may act on before the Court decides whether to approve the proposed settlement. Because your rights will be affected by this settlement, it is extremely important that you read the Notice carefully. The Notice summarizes the settlement and your rights under it.

  • In a class action, one or more people, called class representatives, sue on behalf of people who have similar claims. All of these people are a class, or class members. One court resolves the issues for all class members, except those who exclude themselves from the class.

    The Class Representative alleges that Wells Fargo did not properly apply or disclose the terms of the Buydown Agreements it gave to its customers, and by so doing Wells Fargo purportedly violated the federal Truth in Lending Act, 15 U.S.C. § 1601 et seq. (“TILA”) and related state consumer protection statutes, and breached the terms of the customer’s Buydown Agreement. This is just a summary of the allegations. The complaint in the lawsuit is posted at www.buydownsettlement.com and contains all of the allegations. Wells Fargo denies these allegations; however, in order to avoid the expense, inconvenience, and distraction of continued litigation, the Parties have agreed to the settlement described herein.

  • The settlement resolves a lawsuit brought against Wells Fargo regarding the use of Buydown Agreements or Buydown Deposit Agreements (together “Buydown Agreements”). Both sides agreed to the Settlement. By agreeing to the Settlement, the Parties avoid the costs and uncertainty of a trial, and Settlement Class Members receive the benefits described in the notice. The Class Representatives and their attorneys think the Settlement is best for everyone who is affected.

  • The Settlement Agreement defines the “Buydown Agreement” — sometimes also referred to as a “Buydown Deposit Agreement” or a “FHA/VA Interest Rate Buydown Plan" — as an agreement that lowers the effective rate and required monthly payment for up to the first three years of a borrower’s residential home mortgage loan.

  • If you entered into a Buydown Agreement during the Class Period with Wells Fargo in connection with a residential real estate mortgage loan transaction concerning property located in the United States and you fit the description of the Settlement Class (as defined below), then you are eligible to receive a payment. The judge in the case has certified two Classes for settlement purposes only: The TILA Class and the Breach of Contract Class.  For information about the Class descriptions, see FAQ 5. The Classes together are called the Settlement Class. If you received notice of the settlement directed to you, records indicate that you are a member of the Settlement Class.

  • The judge in the case has certified two Classes for settlement purposes only:

    TILA Class. All persons in the United States (a) who entered into Buydown Agreements with Wells Fargo in residential real estate mortgage transactions; (b) within one year prior to the filing of the Initial Complaint; (c) in which Wells Fargo disclosed in the borrower’s loan Closing Disclosure a lower effective interest rate for an initial period followed by a higher interest rate for the remainder of the life of the loan; and (d) as to whom, during the initial period, Wells Fargo amortized the loan at a rate higher than the lowest disclosed effective rate.

    Breach of Contract Class. All persons in the United States who during the Class Period entered into Buydown Agreements with Wells Fargo in residential real estate mortgage transactions in which Wells Fargo disclosed a lower effective interest rate for an initial period followed by a higher interest rate for the remainder of the life of the loan but, during the initial period, amortized the loan at a rate higher than the lowest disclosed effective rate.

    The Classes together are called the Settlement Class. If you received notice of the settlement directed to you, records indicate that you are a member of the Settlement Class.

    If you are not sure whether you are in the Settlement Class, or have any other questions about the Settlement, you may contact the Settlement Administrator by email or mail. Please see the Contact Us page for more information.

  • Under the Settlement, Wells Fargo has agreed to pay $6,945,095 into a fund from which eligible persons who do not exclude themselves from the Settlement will receive Cash Awards. The fund will also be used to pay settlement administration expenses, any Court-awarded Service Award, and Court-awarded attorneys' fees and costs.

  • Unless you exclude yourself, you will be part of the Settlement Class, and you will be bound by the release of claims in the settlement. This means that if the Settlement is approved, you cannot sue, continue to sue, or be part of any lawsuit against Wells Fargo or the other Released Parties asserting a “Released Claim,” as defined below. It also means that the Court’s Order approving the settlement and the judgment in this case will apply to you and legally bind you.

    The “Released Claims” that you will not be able to assert against Wells Fargo or the Released Parties if you remain a part of the Settlement Class are as follows: “Released Claims” means any and all claims, demands, damages, costs, attorneys’ fees, disputes, liabilities, actions, rights, suits or causes of action, losses or remedies of any kind or nature whatsoever, whether based on any federal law, state law, common law, territorial law, foreign law, contract, rule, regulation, any regulatory promulgation (including, but not limited to, any opinion or declaratory ruling), or any legal or equitable theory, right of action or otherwise, whether known or unknown, suspected or unsuspected, asserted or unasserted, foreseen or unforeseen, matured or unmatured, accrued or unaccrued, actual or contingent, liquidated or unliquidated, punitive or compensatory, as of the date of the Final Approval Order, that arise out of, or relate to, or are based upon or in any manner related or connected with, the Released Parties’ implementation or use of, or disclosures pertaining to, any Buydown Agreement entered into in connection with a residential real estate transaction during the Class Period including, but not limited, to: (i) claims asserting breach of contract; (ii) claims asserting a quasi-contract theory (i.e., promissory estoppel, unjust enrichment, or quantum meruit); (iii) claims asserted under the federal Truth In Lending Act (“TILA”); (iv) claims asserted under New York General Business Law § 349; (v) claims asserted under any state or federal consumer protection law including, but not limited to any unfair, abusive or deceptive practices act or regulation, whether statutory or recognized at common law; (vi) any and all claims that were or that could have been asserted in the Initial Complaint, the First Amended Complaint, the Second Amended Complaint, or in this Litigation; (vii) claims asserting that excess interest was assessed, charged or collected, or that the loan was inappropriately amortized in connection with the application, implementation or use of any Temporary Buydown Agreement; and/or (viii) claims that were or could have been asserted as a member/representative of a putative class or sub-class in the Litigation or in any other proceeding or suit purporting to assert claims in any way related to the foregoing. This Agreement does not imply that any such claims exist or are valid.

    “Released Parties” means Wells Fargo and each of its respective past, present and future parents, subsidiaries, affiliated companies and corporations, and each of their respective past, present, and future directors, officers, managers, employees, agents, general partners, limited partners, principals, insurers, reinsurers, shareholders, attorneys, advisors, representatives, predecessors, successors, divisions, assigns, or related entities, and each of their respective executors, successors, and legal representatives.

  • If you do not exclude yourself from the Settlement Class, the Settlement Administrator will mail you a check. You may be required to first provide certain tax related documentation to the Settlement Administrator in order to be eligible to receive your check.

  • Wells Fargo has agreed to provide monetary compensation to Class Members who do not exercise their right to opt-out of the Settlement. Under the Settlement, Wells Fargo is paying a total of $6,945,095 in compensation to set up a settlement fund to be divided among all Settlement Class Members who do not exclude themselves from the Settlement after any fees, costs, Service Award, and settlement expenses have been deducted. Your share of the settlement will be a minimum of $50.00 for each Buydown Agreement. You may receive more. The amount is only an estimate.

  • The Court held a Final Approval Hearing on August 19, 2021, approved the Settlement and entered the Order Granting Final Approval of Class Settlement. After the approval, there may be appeals. It’s always uncertain whether those appeals can be resolved, and resolving them can take time, perhaps more than a year. Please be patient.

  • If you receive a check, you will have three (3) months from the date of the check to cash the check. If you do not cash the check within 3 months, your check will be void and the funds will be used as the Court deems appropriate, including redistribution to other Class Members or distribution to a charitable organization.

  • If you want to exclude yourself from the Settlement Class, sometimes referred to as “opting-out,” you will not be eligible to recover any benefits as a result of this settlement. However, you will keep the right to sue or continue to sue Wells Fargo or Released Parties on your own and at your own expense about any of the Released Claims.

  • To exclude yourself from the Settlement Class, you must have sent a written request to the Settlement Administrator postmarked no later than June 6, 2021.

  • No. Unless you excluded yourself, you give up the right to sue Wells Fargo for the claims that the Settlement resolves. You must have excluded yourself from the Class in order to try to pursue your own lawsuit.

  • No. You will not receive a payment if you excluded yourself from the Settlement.

  • Alejandro Carrillo sued Wells Fargo and the Court has appointed him to be Class Representative for the Settlement Class. The Court also approved Beth E. Terrell, Ari Brown, and Adrienne D. McEntee of Terrell Marshall Law Group PLLC, and Daniel A. Schlanger of Schlanger Law Group LLP as Class Counsel. If you want to be represented by your own lawyer, you may hire one at your own expense. See FAQ 17 for Class Counsel's contact information

  • No. Class Counsel will ask the Court to approve payment of up to $2,315,029.35 to them for attorneys’ fees, which is 33.33% of the fund. Class Counsel also will ask to be reimbursed for any out-of-pocket expenses. These payments would pay Class Counsel for their time investigating the facts, litigating the case and negotiating the settlement. Class Counsel will also request a service award of up to $12,500 to the Class Representative in recognition of his service to the Settlement Class. The amount of any fee or service award will be determined by the Court.

  • Class Counsel will represent you and others in the Settlement Class. you will not be charged for these lawyers. If you want to be represented by your own lawyer, you may hire one at your own expense.

    Beth E. Terrell
    Jennifer R. Murray
    TERRELL MARSHALL LAW GROUP PLLC
    936 N. 34TH Street, Suite 300
    Seattle, WA 98103
    Tel: 206-816-6603

    BTerrall@TerrellMarshal.com
    JMurray@TerrellMarshal.com

    Daniel A. Schlanger
    SCHLANGER LAW GROUP LLP
    80 Broad St., Suite 1301
    New York, NY 10004
    Tel: 212-575-3276

    DSchlanger@ConsumerProtection.net

     

  • Court-appointed lawyers for the Settlement Class (“Class Counsel”) will ask the Court for a payment of up to $2,315,029.35 from the fund as attorneys’ fees, which is equal to 33.33% of the fund. Class Counsel also will ask the Court to reimburse them for the out-of-pocket expenses they paid to investigate the facts and litigate the case.

  • If you are a member of the Settlement Class, and you did not exclude yourself from the settlement, you could have objected to the settlement or any part of the settlement. To object, you must have sent your objection to the Court, Settlement Administrator, Class Counsel, and Wells Fargo’s Counsel no later than June 6, 2021.

     

  • Objecting means telling the Court that you do not like something about the settlement. You can object to the settlement only if you stay in the Settlement Class. Excluding yourself is telling the Court that you do not want to be part of the Settlement. If you exclude yourself, you have no basis to object to the settlement because it no longer affects you.

  • If you do nothing, you will still receive the benefits to which you are entitled. Unless you exclude yourself, you will not be able to start a lawsuit, continue with a lawsuit or be part of any other lawsuit against Wells Fargo relating to the issues in this case. You will remain a member of the Settlement Class. See FAQ 8 for more information.

  • The Court will hold the Final Approval Hearing to decide whether to approve the Settlement and the request for attorneys' fees, litigation expenses and costs, and Service Award for the Plaintiff.

  • The Court held a Final Approval Hearing on August 19, 2021, approved the Settlement and entered the Order Granting Final Approval of Class Settlement. After the approval, there may be appeals. It’s always uncertain whether those appeals can be resolved, and resolving them can take time, perhaps more than a year. Please be patient.

  • At the Final Approval Hearing, the Court will consider whether the settlement is fair, reasonable, and adequate. The Court will also consider the request by Class Counsel for attorneys’ fees and expenses and Service Award for the Class Representative. If there are objections, the Court will consider them at the Final Approval Hearing. After the hearing, the Court will decide whether to approve the settlement. We do not know how long these decisions will take.

    UPDATE: The Court held a Final Approval Hearing on August 19, 2021, approved the Settlement and entered the Order Granting Final Approval of Class Settlement. After the approval, there may be appeals. It’s always uncertain whether those appeals can be resolved, and resolving them can take time, perhaps more than a year. Please be patient.

  • You may have attended the hearing, at your own expense, but you did not have to do so. You could not speak at the hearing if you exclude yourself from the settlement.

  • If you have objected to the settlement and wanted to attend the hearing you must have stated in your objection that you intended to appear at the Final Approval Hearing either personally or through counsel.

  • No. The Notice is only a summary of the settlement. If the settlement is approved and you do not exclude yourself from the Settlement Class, you will be bound by the release contained in the Settlement Agreement, and not just by the terms of the Notice. Capitalized terms in the Notice are defined in the Settlement Agreement. You can view and download the full Settlement Agreement from the Important Documents page of this website, or request it by contacting the Settlement Administrator by mail or email.

  • For more information, you may contact the Wells Fargo Settlement Administrator by email at info@buydownsettlement.com, or you may contact Class Counsel as set forth in FAQ 17.

    PLEASE MONITOR THIS CASE WEBSITE FOR UPDATES AND OTHER IMPORTANT INFORMATION.

    NOTE: PLEASE DO NOT CALL OR WRITE THE COURT, THE COURT CLERK’S OFFICE, WELLS FARGO, OR WELLS FARGO’S COUNSEL FOR MORE INFORMATION. THEY WILL NOT BE ABLE TO ASSIST YOU.

For More Information

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Mail
Buydown Settlement
c/o JND Legal Administration
PO Box 91345
Seattle, WA 98111