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| Wells Fargo Home Mortgage tightened its nonprime underwriting guidelines and gave notice to hundreds of employees.
On Tuesday, approximately 200 workers in Fort Mill, S.C., received 60-day layoff notices, Wells spokesman Kevin Waetke told MortgageDaily.com in an e-mail statement. “As a result of changing market conditions — such as moderating house price increases — we have chosen to make changes to our credit policy … for certain nonprime segments generally defined by high loan-to-value, high debt-to-income ratios, lower credit scores and low documentation loans,” Wells said in an announcement. The changes are effective for loan applications received on or after Feb. 16. “This decision directly impacts our nonprime loan volume, which in turn impacts staffing levels in the areas devoted to managing these loans,” Wells added. The San Francisco-based banking behemoth said that most affected employees receive separation benefits, including insurance and salary continuation based on years of service with Wells, and that special consideration will given to those who want to stay with the company. |
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