ACORN Targets Wells Fargo

ACORN is targeting Well Fargo & Co., San Francisco, to get the well-known banking company to reform the lending practices of its two finance companies.The community activist group alleges that Wells Fargo Funding and Wells Fargo Financial are making subprime mortgage loans with the same high fees and rates and terms as other predatory lenders that have entered into large settlements with regulators. "We are trying point out that Wells, despite being a national bank, has subprime affiliates engaging in all of these predatory practices," ACORN spokesman David Swanson said. In a 15-page report, ACORN said it found that prime borrowers are being charged high fees and rates by the finance companies, instead of being referred to Wells Fargo's prime mortgage units. In addition, some loans appear to have fixed rates, but it is really a floor and an 11% interest rate can go up to 17%, the group said. "We will be working to build pressure to reform Wells Fargo over the coming weeks and months," the ACORN spokesman said. "And we will see what kind of reaction we get out of them." In response, a Wells Fargo spokeswoman told MortgageWire that the practices described by ACORN are "totally contrary to our ethical standards and our business practices. It is simply not the way we do business."