While we do love our technology here at Ideaing, we’re not oblivious to the associated risks and problems it can cause. That’s definitely the case with a software glitch at Wells Fargo that lost people their homes.
Yes, due to a “calculation error” some people lost their homes thanks to a Wells Fargo loan underwriting tool.
What the Hell Happened? What is This Software Glitch?
Imagine having your mortgage loan or revision denied as a result of a “calculation error” from a software glitch.
Brought to light by a recent SEC filing, some Wells Fargo customers were affected by a software glitch or miscalculation that saw their loan changes denied and valid offers outright neglected. In other words, certain people that applied for a loan extension or update were denied. Others didn’t even receive an offer to remedy repayment issues they were experiencing.
According to the report, about 625 customers were affected. Only 400 of those customers lost their homes as a result of foreclosure. Of course, Wells Fargo being the stand-up company that it is says that the error absolutely did not cause the foreclosures. It’s not like it helped out the families that were affected either.
The glitch was rampant from April 13th, 2010 until October 20th, 2015 whereupon the company had developers fix the issue.
The good news is that Wells Fargo has issued a public apology, and set aside “remediation” funds of about $8 million for those affected. Assuming all 400 foreclosures warrant monetary support, that chunk amounts to about $20,000 per family — not nearly as much as your average suburban home.
The Darker Side of Technology
When Technology Goes Bad, Episode 403.
Obviously, this isn’t a common problem, but it does certainly highlight the caveats of working with software and technology. A simple glitch made financial and mortgage problems even worse for the affected homeowners, and it’s certainly possible it could happen again.
As we work to improve the technology at our fingertips, we have to consider what it means for society.
Alternatively, it could also be the proof we finally need to drop banks and financial institutions altogether and go full revolution with modern cryptocurrencies, because screw the man… or something.