Wells Fargo, the largest U.S. mortgage lender, is tiptoeing back into subprime home loans again.It's not like Warren Buffett will not lobby for another TARP bailout if things don't go wrong.
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.
Friday, February 14, 2014
Posted by Steve Bartin at 6:19 AM