https://www.bloomberg.com/graphics/2022-wells-fargo-black-home-loan-refinancing/
Other lenders approved Black and Hispanic applicants at 72% and 79% respectively. Whereas Wells Fargo approved just 47% and 53%.
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“It says it treats all potential borrowers the same, is more selective than other lenders, and an internal review of the bank’s 2020 refinancing decisions confirmed that “additional, legitimate, credit-related factors” were responsible for the differences. “
Additionally, “ Kristy Fercho, who in August 2020 became the first Black woman to oversee Wells Fargo’s home-lending business and its more than 25,000 employees, says the bank’s processes are race-blind and that its lending decisions were “consistent across racial and ethnic groups.”
It’s not clear that anything is amiss here.
I haven’t applied for a loan ina while. Is race a question they ask on the application?
Is the industry standard to give people loans, as long as they're POC, regardless of creditworthiness?
Did any of you read the article or just think of course it could not have been a Wells problem. All lenders have stricter standards and the default rate is lower for all lenders. Guess Wells just thinking they don’t have to follow industry standards and it will bite them in the bu-t.
I would assume, with the cap on assets (loans/mortgages being assets) that it is probably a stricter view on approving loans so that the asset quality remains good. Handing out loans just because of a person's skin color is a great way to destroy those assets.
Like the good standards that WF had when they made changes to your account like adding services and charges without your request or approval? Oh wait, they did let you know by delivering an email to your spam folder.
What was their EBITDA and DTI ratios?
Can't scream racist when there is legitimate fairness in the application process.
Sounds like jealous other banks are paying for this garbage to be produced. WF historically has some of the lowest credit losses in the industry, other banks hate that. That's not racism, that good underwriting standards. This is a core function of a bank, banks die all the time from this.
Fu-k Wells Fargo
How does JP Morgan, Bank Of America, Citi compare? Its odd they just say All other Lenders.
So what's the point exactly.. Just that our Credit Risk here is better than these other so called lenders? Credit losses on bad loans are past on to the rest of consumers in the form of higher rates, why do other customers have to pick up the tab. This is how 2008 occurred but some don't want to admit they caused the downfall, its sad they never learn.