Wells Fargo edges back into subprime lending

Feb 14, 2014, 4:37 AM EST
A sign is posted in front of a Wells Fargo bank on October 11, 2013 in Oakland, California.
AFP/Getty Images

Wells Fargo & Co, the largest U.S. mortgage lender, is tiptoeing back into subprime home loans again. The bank is looking for opportunities to stem its revenue decline as overall mortgage lending volume plunges. It believes it has worked through enough of its crisis-era mortgage problems, particularly with U.S. home loan agencies, to be comfortable extending credit to some borrowers with higher credit risks. The small steps from Wells Fargo could amount to a big change for the mortgage market. After the subprime mortgage bust brought the banking system to the brink of collapse in the financial crisis, banks have shied away from making home loans to anyone but the safest of consumers.
Background:
Wells Fargo edges back into subprime as U.S. mortgage market thaws [Reuters]
Blog: How will Wells Fargo handle mortgages now that the refi boom is over? [WSJ Marketwatch]

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