California Reinvestment Coalition

Demand a Stop to Wells Fargo’s payday lending and foreclosures!

October 18, 2012

Wells Fargo is getting examined for its CRA practices right now. We all have a rare opportunity to tell the federal regulator of national banks (Comptroller of the Currency or OCC) whether they think Wells Fargo Bank is meeting community needs. Please scroll down to customize and send a letter to the OCC & Wells Fargo before December 7!! Bank examiners use these comments to grade the bank. The California Reinvestment Coalition is calling on people across California and the nation to write the Comptroller about Wells Fargo.

Bank Payday Lending: Wells Fargo sells a payday loan called the Direct Deposit Advance. They charge a 180% annual percent rate. They lure customers into a debt trap that can last six months or even longer. After five months, customers have already paid more in fees than they ever borrowed. The OCC has stated that “banks should not use products to take advantage of their customers.” CRC thinks Wells Fargo Bank is exploiting their customers with this product and should stop immediately. If you agree, please tell the Comptroller of the Currency today!

Payday to the Military: Congress passed a 2006 law prohibiting lenders from offering active-duty members of the military consumer loans with annual percentage rates of greater than 36% APR. Wells Fargo is using a loophole in Department of Defense regulations to continue payday lending to men and women in uniform. If you think this is wrong, tell the Comptroller of the Currency today!

Foreclosures and Evictions: Wells Fargo has been sued by our Attorney General (and 48 others) for robo-signing and faulty foreclosure practices and by the Department of Justice for steering borrowers of color into more expensive subprime loans. Housing counselors and legal service offices report that Wells Fargo is still reluctant to help borrowers at-risk of foreclosure and improperly denies borrowers loan modifications for which they qualify. Wells Fargo allows its’ agents to violate tenant protection laws and will not offer tenants the opportunity to pay rent and remain in their homes. If you think this is wrong, tell the Comptroller of the Currency today!

This is the public’s opportunity to be heard. Write to the Comptroller now. With this easy to use form, you can be done in 5 minutes!

Please customize this letter to reflect your personal information and to add any other information you would like to include on Wells Fargo's performance in California. Your personal perspective is very important!

Subject:

Your Letter:

Dear Mr. Wilson:
cc: Barry Wides, OCC; John Stumpf, Wells Fargo; Brenda Wright, Wells Fargo; CFPB

I am writing this letter to comment on Wells Fargo Bank’s CRA performance in California.  This letter comments only on Wells Fargo’s payday lending (direct deposit advance loans) and mortgage servicing but these programs say a great deal about the Bank’s broader approach to community needs.

As stated in the Comptroller of the Currency’s (OCC) Guidance on Deposit-Related Consumer Credit Products issued last year, “bankers should not use these products to take advantage of their customer relationship.”  Wells Fargo’s Direct Deposit Advance Product takes advantage of thousands of their customers by offering this 180 annual percentage rate payday product.  This traps them in predatory high debt and takes “advantage” of them.  Wells Fargo takes money that customers need for food and shelter.

Wells Fargo has also found a loophole to avoid federal laws that prohibit payday lending to military personnel.  Congress passed a law in 2006 allowing no consumer loans for greater than 36 percent annual interest to active-duty members of the military but Wells Fargo charges 180 percent annually to thousands of military families.

Wells Fargo's mortgage servicing policies and practices do harm to communities. As one example, 44% of California housing counselors surveyed by the California Reinvestment Coalition reported that Wells Fargo denied loan modifications to borrowers who were qualified for a loan mod. Wells Fargo has not significantly offered loan modifications with principal reduction, except where it actually owns the loan. 84% of counselors rated Wells Fargo as “terrible” or “bad” when it comes to modifying loans for borrowers who should be able to stay in the homes.

Finally, Wells Fargo has allowed unlawful evictions of tenants living in foreclosed homes. It refuses to develop a policy to allow tenants to continue paying rent on foreclosed homes controlled by Wells Fargo.

I hope the OCC will look carefully at these and other programs where Wells Fargo is not meeting community needs.  If you have any questions, please contact me at the information below. Please include a copy of this letter in Wells Fargo's public CRA file. Thank you.

Barry Wides

Office of the Comptroller of the Currency

Brenda Wright

Wells Fargo Bank

Chris Vaeth

Consumer Financial Protection Bureau

cc: California Reinvestment Coalition

Thanks for standing up for California's communities!