Home News Wells Fargo denied nearly half of mortgage refi requests from Blacks in ’20

Wells Fargo denied nearly half of mortgage refi requests from Blacks in ’20

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One of the country’s largest mortgage providers approves nearly three-quarters of those submitted by white applicants in 2020, while rejecting nearly half of refinancing applications submitted by black homeowners. did.

Wells Fargo, according to an analysis by Bloomberg News, was well below the industry average in reducing interest rates through refinancing homes to African-Americans approved by all other lenders with a 71% chance. Wells Fargo’s 47% approval rate set the worst record among major lenders when considering refinancing black homeowners.

Bloomberg screened information made available through the Mortgage Disclosure Act, including data on 8 million completed applications to refinance traditional loans in 2020, and Wells Fargo regarding overall refinancing approval. I found it to be more modest. 87% approval by white homeowners vs. all other lenders. 67% vs. 85% for Asian lenders. 53% vs. 79% for Hispanic lenders.

Wells Fargo did not challenge the numbers, according to the report. Banks in San Francisco argued that there was a more selective process for treating all potential customers the same and approving loans, with “additional, legitimate, credit-related factors.” I was responsible for the difference in numbers.

According to experts, the refinancing gap makes it more difficult to build wealth using real estate owned by black families. Andre Perry, a senior fellow at the Brookings Institution, said that the lack of refinancing approval means that black homeowners can invest in children, start businesses, remodel homes, or add homes. He told the news site that it meant that he had less resources to buy. According to Perry’s 2018 survey, the average black house is worth $ 48,000 less than its white equivalent, and reports show that the difference in losing black wealth is $ 156 billion. ..

So far, the US Department of Justice has been chasing banks for lending practices that can incur costs to minority borrowers. Authorities leveled penalties for US lending giants after a 2008 housing crisis investigation suggested discriminatory treatment. In 2012, Wells Fargo over $ 184 million to resolve federal claims that it charged higher fees and interest rates after unfairly inducing Black and Hispanic homeowners to subprime mortgages. Agreed to pay. The bank did not admit fraudulent business practices and said it treated all customers fairly.

In March 2017, Wells Fargo $ 110 million to resolve a national class action alleging that employees have opened more than 2 million deposit and credit card accounts since 2011 without the permission of their customers. Agreed to pay. According to the published report..

[Bloomberg News] — — Vince Dimisseri

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