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klifffy
Cherry Bomb


Joined: 03 Aug 2007
Posts: 185

Wells Fargo Just closed Wholesale
PostPosted: Thu Jul 12, 2012 5:12 pm Reply with quoteBack to top

Wells Fargo just closed wholesale.
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chrispic88
Dud?


Joined: 06 Apr 2011
Posts: 11
Location: Long Island, NY

Re: Wells Fargo Just closed Wholesale
PostPosted: Thu Jul 12, 2012 5:52 pm Reply with quoteBack to top

what does everyone think - is this the end of the broker or is there still a chance for survival?
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MakingIt
Nitroglycerin


Joined: 04 Dec 2007
Posts: 629

Re: Wells Fargo Just closed Wholesale
PostPosted: Thu Jul 12, 2012 9:04 pm Reply with quoteBack to top

Not the End, but It's not a good thing.

If you read the DOJ lawsuit then most wholesale lenders could be held liable for a wholesale loan from the time the originator spoke with the client until anytime in the past.

The BS part -- this lawsuit was due to Wells subprime, not the A paper they just shut down. Also, it was mostly a retail wells related lawsuit.
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bringit212
Cherry Bomb


Joined: 17 Nov 2007
Posts: 195
Location: At the office : )

Re: Wells Fargo Just closed Wholesale
PostPosted: Sat Jul 14, 2012 4:31 pm Reply with quoteBack to top

MakingIt wrote:
Not the End, but It's not a good thing.

If you read the DOJ lawsuit then most wholesale lenders could be held liable for a wholesale loan from the time the originator spoke with the client until anytime in the past.

The BS part -- this lawsuit was due to Wells subprime, not the A paper they just shut down. Also, it was mostly a retail wells related lawsuit.


Which is why there is truth to the statement Wells made saying that the lawsuit and the wholesale exit were not related. I'm sure it contributed but the fact is the more "unrelated" the two situations are the worse it is for the overall broker landscape. Others will follow. Sad
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StephenF
Nitroglycerin


Joined: 08 Dec 2007
Posts: 981
Location: New Jersey

Re: Wells Fargo Just closed Wholesale
PostPosted: Sun Jul 15, 2012 4:54 pm Reply with quoteBack to top

Spoke with a Wells employee who is not a smoke & mirrors type, very straight forward. Told me that the decision was not predetermined & essentially is a reaction to the language put forth in the settlement.

The language stipulates that Wells would be responsible for all loans they funded from the very 1st phone call made on the deal. They would be responsible for the broker and LO's et al and quite frankly are not interested in the risk that presents...Can't say I blame them on that issue...If other lenders follow this will be very trying for brokers. Dare I say, if you can't beat them join them?

_________________
“During times of universal deceit, telling the truth becomes a revolutionary act”
– George Orwell
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Sachcan9
Cherry Bomb


Joined: 02 Nov 2007
Posts: 161
Location: woodland hills

Re: Wells Fargo Just closed Wholesale
PostPosted: Wed Jul 18, 2012 11:11 pm Reply with quoteBack to top

Ah, The demise of the mortgage broker is now once again at the forefront of conversation. Since 2008 I have been hearing this same story.

While, I do think that Wells fargo's exit from wholesale is a blow, I think that it is also no where near as bad as people are making it out to be. First of all, they are still active in correspondent and the lenders we work with are telling me that Wells fargo has assured them that they will not be cutting those ties. Secondly, do you guys really think that the entities that are making money off of brokers like the department of real estate or NMLS will be quick to close their doors? The wholesale model will still be here in some form because it is profitable and that determination has more of a pull then some risk that people will say it has. Broker loans today are performing extremely well and banks are making a killing off of the business we are sending them.

It's just another things for us brokers to overcome but we have done it before and will continue to do it in the future.
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MakingIt
Nitroglycerin


Joined: 04 Dec 2007
Posts: 629

Re: Wells Fargo Just closed Wholesale
PostPosted: Sat Jul 21, 2012 1:55 am Reply with quoteBack to top

[quote="StephenF"]Spoke with a Wells employee who is not a smoke & mirrors type, very straight forward. Told me that the decision was not predetermined & essentially is a reaction to the language put forth in the settlement.

The language stipulates that Wells would be responsible for all loans they funded from the very 1st phone call made on the deal. They would be responsible for the broker and LO's et al and quite frankly are not interested in the risk that presents...quote]

I still think it's an overreaction.

These were subprime loans. Most done by Wells retail themselves and not brokers. Yet, they closed their Prime Wholesale division that was not even a part of the lawsuit ? Ironically, most of the subprime broker LO's are not in the business yet their WF retail counterparts moved over to be HMC's a few years ago. Crazy.
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