https://www.forbes.com/sites/korihale/2022/06/07/wells-fargo-is-taking-a-hard-pass-on-53-of-black-mortgage-applicants/amp/
23 replies (most recent on top)
You'll never see a reporter or prosecutor look into the applications to see if any of the rejected applicants shouldn't have been rejected.
GD dude, recent bankruptcy or do you just never pay your bills on time? I always get approved and I don't make anything close to that.
Charlie's response:
"While it might sound like an excuse, the unfortunate reality is that there is a very limited pool of black mortgages to approve from".
Race is not a factor. Be a good candidate, get your credit score up, and the banks will compete for you business.
This is all bu-----t as usual. They do it to white people too. It is easy to yell and scream thinking it has to do with race. That is so stupid. I am white and made 120K in 2016 and they denied me as an employee. Get over yourselves.
If one single financial standard applies to ALL, yet one particular group consistently and disproportionately falls short, then does a separate standard need to be applied to that group...?
As an underwriter for many years I can attest that I Never looked to see what race the applicants are. Why? The only things that matter are credit, assets, job stability and savings/financial stability, appraisal/title, etc. Race is not a factor!
Its the new fad! If you get denied for anything even when it is a legit denial you just pull the race card!
Ironically, those applicants possess a pass that Charlie would very much like to get his hands on
Some DEI Gods are paying someone to post this nonsense implying racism. Don't buy it.
Hard pass based on income and or credit history.
I agree with previous posters -- show us what factors could be used to even inadvertently deny black applicants. If they exist, they'd fall under disparate impact, I would think.
In regards to the thread title, what would a soft pass look like?
Serious question - how are the models allegedly being built to disproportionately impact blacks? Details please
Didn’t one of the execs say we reported numbers differently than others? We reported cancelled as rejected, while other banks did not include them (might have it wrong a bit sorry not in mortgage biz). Was that just smoke or some truth?
Look past color of skin and look at the numbers (FICO, liabilities, income, etc). Stop the alarmist B. S.
while the models themselves are color blind the people building them are not. Additionally, one needs to look at the underlying systemic factors that cause racial inequality and create a system where a smaller proportion of your population is being dispoportionatly effected. but yeah, we don't see color
So maddening. Statistical factors of income, debt to income ratio, credit score and loan to value, etc drive what are automated decisions and not race. Sorry folks. While every kid may get a trophy these days, it’s not how it works in the mortgage lending industry
While the 1003 (loan application) does include a spot for race, it’s optional, and the loan system wouldn’t allow a person to decision a loan based on race. Loan decisions are based off of numbers, and Wells Fargo has always been conservative, which was a strength of the company back in 2008. A lot of mortgage companies were going under because of risky lending practices, whereas WF weathered the storm.
To be fair, the original bloomberg article did point out the guy has a decent job and high credit score. What it didn't talk about though was his debts, where the house was located, his job history (he changed jobs like every 2 years in the decade leading up to this), etc. It also failed to emphasize that he applied for this in Feb 2020, you know, right before a bunch of fun stuff went down.
Quick googling: the old "investment" house he was trying to refinance is in Lithia Springs, GA. Basically a uneventful, borderline boonies suburb near Six Flags Over Georgia. While Atlanta is a hot market, that area isn't near any of the "happening" places here and hasn't really appreciated in value. Actually, when adjusted for inflation, if what I found was his house (bought in 2006 for 229,800 and sold for 315,400 in 2021), basically hasn't appreciated in value. He had also tried to sell it previously in 2018 for LESS than what he had purchased it for12 years prior and eventually removed that listing (meaning he couldn't sell it), which is a clear red flag.
tldr: the person from the original article that this one sources is a terrible, terrible example. This is almost a textbook example of a causal fallacy. I have no love for WF and quit this year, but good grief. WF will make decisions based on what will make them the most money with the least amount of risk.
While this place is example #1 of a sh!tshow, I don't believe this for a minute. If WF thinks they can make a buck off you, they'll take your business. Race has nothing to do with it.
Race is not a factor. I have worked in data at Wells for over a decade, and I have NEVER seen a field that indicates race. When you fill in the application, it does not ask you your race. When the system gets sent to the decision engine or underwriter, there is no way it knows your race. Be it for car loans, home loans, anything. The bank does not know your race, height, se-ual orientation or shoe size. Its not important. What is important is your credit score and income. The bank wants to know if you are the type of person to pay them back. That's it. It is as simple as that.
You either qualify for a loan or you don't, and race is not a factor. At least it isn't yet, I'm sure we'll transition to a "any bipoc that applies gets approved, we only deny white people" policy any day now.
It's almost like some people weren't awake when the 2008/2009 crisis happened. Do not loan money to someone, anyone, if the data suggests that they won't be able to pay it back. That's the ONLY possible policy. Everything else will fail spectacularly.