Wells Fargo looks like NovaStar as Wells panics
A random survey of homeowners asked the following questions: (1) Who is your mortgage company, and (2) How would you rate their customer service. It seems as though Wells Fargo may be the next troubled lender if their fear factor and desire to call mortgage holders before the due date is any indication. Some homeowners that were on vacation during spring break reported that Wells Fargo paniced and called them before they returned from vacation. Their payments were not late nor were they past due.
NovaStar mortgage was a leader in subprime, but during the summer of 2007 NovaStar began to question the validity of their loans. NovaStar called home owners many times per day, every day, even though their payments were not late. It seems Wells Fargo is behaving the same way. Calls begin as early as the 10th of the month. Our survey also prompted people to talk about efforts to refinance. One home owner said Wells Fargo asked for a structural engineering report of buildings on the property, which was a nice way of saying Wells Fargo would not finance the sale. The person reported that Wells Fargo had other demands that were met, and negotiations dragged on for over 30 days. “What a waste of time and effort” said the property owner.
Wells Fargo CEO John Stumpf would like you to think his company is doing well. The truth is Wells Fargo argued that the application of the state law would violate their federally protected powers according to the Office of the Comptroller of the Currency regulations. Ohio has been unkind to Wells Fargo, and Baltimore has rumbled about predatory lending. Wells Fargo decided to abandon the practice of making what are called “sub-prime” loans. The question is what to do with existing customers if Wells Fargo does not like them any more. Maybe the answer is to annoy the hell out of them.