Three big U.S. banks, with others likely to follow, are getting out of the “deposit advance” business, in which consumers seeking short-term cash can be hit with high fees amounting to as much as 300 percent annual interest.
The bank convened a private summit in the San Francisco area Tuesday with experts talking about cryptocurrencies, affiliated payment services and other bitcoin-related businesses to give Wells Fargo a fuller picture of the fast-evolving and misunderstood digital movement.
Mortgage origination and application volumes have been declining over the last six months in the wake of higher long-term interest rates. Mortgage rates have risen more than 100 basis points off their lows in May.
Rising home prices has changed the mortgage landscape on many levels. For one, some big lenders are now competing with the Federal Housing Administration in offering 5 percent down-payment mortgages.
Bank of America has moved at a faster clip than Wells Fargo, JPMorgan Chase and Citigroup in meeting obligations to help borrowers facing possible foreclosure under last year’s $25 billion National Mortgage Settlement. The latest audits credits Bank of America with 97 percent of its required $7.6 billion in consumer relief as of the end of last year.
Wells Fargo, the nation’s largest home lender, made $80 billion in home loans in the third quarter, down from $139 billion a year earlier and down from $112 billion in the previous quarter.
JPMorgan Chase’s climbing legal expenses — the nation’s largest bank set aside $9.2 billion to deal with regulators and other authorities — has led to the bank’s first quarterly loss under Chief Executive Jamie Dimon.
New York’s attorney general said he is suing Wells Fargo to get the nation’s largest mortgage lender to comply with new servicing standards under last year’s five-bank settlement spurred by foreclosure-related abuses. Meanwhile, Attorney General Eric T. Schneiderman said today that his office has reached an agreement to suspend a similar enforcement action against Bank of America.
The motion seeking a temporary injunction brought by Wells Fargo and Deutsche Bank was premature because Richmond officials have not exercised eminent domain and it’s uncertain if they will, the judge ruled.
JPMorgan’s exit shouldn’t make it difficult for college borrowers to find willing lenders. But that doesn’t make the terms to some of these loans any easier. Many private student loans are difficult to re-negotiate and carry higher rates that federal loans.