Wells Fargo: Where prudence (mostly) reigned

Wells avoided the Option ARM and was only into subprime a short time. That is the major difference

mmm let me guess, JO (from Dallas, CHL’s second home) is either currently employed by or was employed by Countrywide. Their aggressiveness was in the option arm category, not necessarily the hybrid arms. A company doesn’t just lose over 80% of its value in less than 12 months due only to its portfolio, which is only at about 7% delinquent. It appears their corporate culture as a whole is troubled with now even accounting standards being questioned. It’s unfortunate, there are many good people that work for and support Countrywide on a day to day basis and they are really taking a beating.

know what you are talking about before you throw things like this out – as a former loan officer with a large mortgage banker, I know Wells was every bit as aggressive on ARM product, and stated income, as anyone. They, in fact, were one of the first to offer that program, called their VOA (verification of assets) program. The biggest difference between Wells and Countrywide is that Wells is not a mortgage centric company – Countrywide is always going to be more aggressive than Wells because of this. But if you have been in the industry before, you would know that Countrywide is also historically conservative on the lending scale than many, despite having a broad breadth of products to offer, whether it is on stated documentation, credit scoring or appraisal values – get a clue before you talk and/or stop commenting on an industry you clearly don’t understand

Just wait til Wells Fargo reports their adjusted earnings due to level 3 accounting. Then, see if you say the same thing…

I’m a CA native. While I agree Wells was more prudent, it is only on a relative scale. CFC and WM are likely to go out of business from this crisis so comparing them to those two is hardly a comparison at all. Nor can you compare them to similar-sized Wachovia – which made one of the worst acquisitions in banking history (buying Golden West at top of cycle).
Wells does look better against some very poor peers…BUT…Wells trades at a huge premium to nearly everybody and they were close enough to the problems that you really have to wonder. Wells was still the largest home lender in the country during most of the bubble years. Furthermore, they were centered in California and other growth states where the bubble was worst. I suspect that as this crisis grinds on and start impacting the more prime categories of homeloans, the shine will come off Wells Fargo.

Just where and when does the person who signed their name on the dotted line for a loan take responsibility for comprehension of terms they are agreeing to. Granted some people may not have understood some areas but they should have asked questions or refused to sign the documents until the understood them.

Interesting…..JPMorgan Chase (the bank that supposedly was more risk friendly)has less writeoffs than Wells and others, yet you choose to laud Wells?
Arm products and documentation types are two different things.

Obviously Adam Lashinksky thinks that banks gain market share because they loosen lending guidelines. Risk vs reward scenarios have been outrun by competent and ethical salespeople since commission was invented as a way of making a living. Wells nary turns an eye on how it’s mortgage sales people actually succeed. If I ran a business and a long-time loyal customer didn’t find the product they were looking for with me, I would close up shop. By the way, Well’s 5-1 relationship ARMS have been the most aggressively priced in the industry–perhaps Adam L doesn’t need to be so loyal!

It’s simple. Wells Fargo was not greedy like CFC. CFC at this time is being investigated by 2 states, IL & CA for their so called lending practices on loans that customers are defualting on. It’s all about greed.