Mortgages are by far the largest category of debt held by Americans, making up 71% of the $16.5 trillion in total household balances.
Wells Fargo which was the country’s top lender as recently as 2019 is making significant changes that will have huge implications for the U.S. mortgage market.
The massive financial services institution is stepping back from the multi-trillion dollar market for U.S. mortgages amid regulatory pressure and the impact of higher interest rates.
Instead of reaching as many Americans as possible, the “woke” corporation will only offer home loans to existing bank and wealth management customers and borrowers in minority communities, CNBC has learned.
The two factors driving the change in its business model include the lending market collapsing since the Federal Reserve began raising rates last year and the increased regulatory oversight, said consumer lending chief Kleber Santos.
Santos said in a phone interview. “As part of that review, we determined that our home lending business was too large, both in terms of overall size and its scope.”
It’s the latest strategic shift that CEO Charlie Scharf has undertaken since joining Wells Fargo in late 2019.
As banks stepped back from home loans after the disaster that was the early 2000′s housing bubble, non-bank players including Rocket Mortgage quickly filled the void.
Today, Wells Fargo is the third biggest mortgage lender after Rocket and United Wholesale Mortgage.
With the change in its business model, thousands of mortgage workers were let go or voluntarily left the company last year as the business declined.
“It’s very different today running a mortgage business inside a bank than it was 15 years ago,” Scharf told analysts in June.
“We won’t be as large as we were historically” in the industry, he added.
But in line with its commitment to the World Economic Form and the Great Reset objectives, Wells Fargo is moving forward with combating inequality, in the pursuit of racial equity.
Even though Wells Fargo is pulling back from the general pool of potential mortgage borrowers, it will be investing $100 million towards its goal of minority homeownership and placing more mortgage consultants in branches located in minority communities.
“Our priority is to de-risk the place, to focus on serving our own customers and play the role that society expects us to play as it relates to the racial homeownership gap,” Santos said.
From the Well Fargo website:
“We’re taking an active role in addressing pressing societal challenges to drive positive impact.”
“Learn about our environmental, social, and governance (ESG) strategy, activities, and performance through the disclosures below.”
The mortgage shift marks what is potentially the last major business change Scharf will undertake after splitting the bank’s operations into five divisions, bringing in 12 new operating committee members, and creating a diversity segment.
PureTalk – Save Big Money On Your Cell Phone Bill (Use Promo”FLSfree” to get one free month)
Conservative independent talk show host and owner of https://MAGABOOK.com. USMC Veteran fighting daily to preserve Faith - Family - Country values in the United States of America. Check out my podcast - https://www.spreaker.com/show/finish-the-race
A senior House Republican lawmaker told Politico on Monday that there are not enough Republican votes to send...
President Joe Biden is masking up in indoor areas yet again after first lady Jill Biden...
More than a year after it received the initial Freedom of Information request, the National Archives...
Subscribe to our newsletter!
Download My Podcasts Below
Finish The Race Podcast
Christian Talk Podcast
Download My Podcasts Below
Awesome Deals On MyPillow.com Products (With Promo code "FTR")