Wells to Pay $175 million for steering and overcharges
WASHINGTON, D.C. – July 12, 2012 – (RealEstateRama) — Today’s Department of Justice fair lending settlement with Wells Fargo Bank is welcome news, and highlights the benefits of new mortgage rules to combat predatory lending. The DOJ settlement of $175 million settles charges that Wells Fargo steered about 4,000 African-American and Hispanic families into higher-cost subprime mortgages while white borrowers with similar qualifications received safer, cheaper prime loans. DOJ also found that about 30,000 people of color paid more for their mortgages in fees and rates because of their race or ethnicity.
New and pending mortgage originator rules from the Federal Reserve and Consumer Financial Protection Bureau have begun to stop these pernicious practices. The impact of discriminatory pricing on African-American and Latino communities has been severe and will take generations to remedy. We commend DOJ for pursuing this and other cases to address pricing discrimination and the steering of borrowers into bad home loans.
For more details on the Wells Fargo settlement, see the DOJ’s website at http://www.justice.gov/opa/pr/2012/July/12-dag-869.html. See also CRL’s report, “Foreclosures by Race and Ethnicity” at http://rspnsb.li/LchK1i.
For more information: Kathleen Day at (202) 349-1871 or ; or Ginna Green at (510) 379-5513 or .
About the Center for Responsible Lending
The Center for Responsible Lending is a nonprofit, nonpartisan research and policy organization dedicated to protecting homeownership and family wealth by working to eliminate abusive financial practices. CRL is affiliated with Self-Help, one of the nation’s largest community development financial institutions.