Lawsuit alleges that Wells Fargo processed larger PPP applications first in order to bolster their own fees. What a **** company.
OT: Wells Fargo being sued aGAIN
- Thread starter 11thEagleFan
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Their fees? I don’t think we had to pay a fee with them to apply.
They were asking for guarantors early on though which they later dropped.
They were asking for guarantors early on though which they later dropped.
The fee was actually up to 5%. Banks are going to make some pretty crazy revenue on this program.
Don't know about all, but Cadence used SmartBizLoan to process and would process nothing under $30,000 for about the first week.
Privatize the government.
I have no idea why the banks should have been involved. I own a business and I promise, when I pay the government, it goes directly to them. Never needed a middle man for that.
The banks only got involved because the bureaucrats and politicians are too crooked or too stupid to not let them.
The govt paid the fee
When they decided to run it through SBA, and thus the banks, they had to compensate banks for basically blowing up their capital and liquidity ratios. We churned our over $250mil in ten days despite the cluster. That’s two year’s worth of budgeted loan growth going out the door in ten days, then hopefully coming back In 90. Any that isn’t reimbursed is kept on our books at 1% interest and a 100% gty (which are really fun to get SBA to pay a loss claim on).
There’s a fee on every loan any bank processes. The government just covered it this time, and they were in line with what is normal. The quantity of loans is going to lead to a lot of non interest income this month, which will probably just get pumped into loan loss reserve for what may be coming.
The fees were regressive by the way. Not sure where they started but it was some% for loans under like $100,000. Then it gradually decreased as the loan amount went up.
When they decided to run it through SBA, and thus the banks, they had to compensate banks for basically blowing up their capital and liquidity ratios. We churned our over $250mil in ten days despite the cluster. That’s two year’s worth of budgeted loan growth going out the door in ten days, then hopefully coming back In 90. Any that isn’t reimbursed is kept on our books at 1% interest and a 100% gty (which are really fun to get SBA to pay a loss claim on).
There’s a fee on every loan any bank processes. The government just covered it this time, and they were in line with what is normal. The quantity of loans is going to lead to a lot of non interest income this month, which will probably just get pumped into loan loss reserve for what may be coming.
The fees were regressive by the way. Not sure where they started but it was some% for loans under like $100,000. Then it gradually decreased as the loan amount went up.
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My bank did about $850 million and it was a nightmare. I’ve been involved but not on a daily basis. We got crews basically running 24 hours a day to process these loans.
Well you wouldn't need a middle man, you could have lower interest, and you wouldn't have a private unknown group of bankers that the entire nation is indebted to but can never pay back.
I don’t know about that. You may not have much experience with student loans, but my wife did. Her rates were a full percentage point higher on the federal loans than the private ones. No reason to just assume other loans would be any different, or that a nationalized bank rate will be lower because you cut out the middle man. You also cut out all the competition as well.
I don’t like that we pay interest to the Fed on money they made out of nothing but we don’t even know who they are anymore than you do, but the govt wouldn’t do it any other way. Could they cut out the middle man and pass the savings on to regular folks, sure, but they wouldn’t. They would still funnel the money to their favorite people, just like it’s done now. That’s why so many people fought against a national bank early on, and we technically don’t have one know. The one in England worked to keep the little guy down, and worked for the elite.
I just thought I would add - I went through the PPP application with Wells and probably 3 separate small businesses. Our applications were provided to us in basically the same order they were requested.
Granted, I have no idea what's happening internally, but everything seemed fine on the outside looking in.
Granted, I have no idea what's happening internally, but everything seemed fine on the outside looking in.
What do you think would have happened if a government agency was directly handing out loans? You think they would have been able to verify that the businesses were real or that the 2.5x two months of payroll were real? And if they had 17ed it up, what would be the recourse? THe bureaucrats definitely wouldn't ahve been on the hook.
Using the SBA was a way to allow private actors with subject matter expertise and some skin in the game (at least as far as verificatino; the credit risk is obviously all on the government) to administer the project. I'm not a big fan of the PPP loans as far as how they were designed but I don't think you can fault how quickly the program got money out. Sucks that people not already working with an SBA lender were basically frozen out, but hopefully they'll get in with this next round of funding.
Not that wells fargo isn't a **** company, but how else would it work? Most banks I know were taking care of their existing relationships first. If you are dealing with a massive bank like that, you have to be massive to move the needle very much as far as them wanting to take care of you.
Agree, Wells Fargo has been ****** to deal with so far in this crisis.
We have a few loans with them, and they are being dicks.
On one large loan in particular, they are not offering any relief whatsoever, while we know with certainty that on many other loans they are offering 90 day abatement of interest, or both P & I. Meaning, they are isolating certain customers who have guarantees in place while letting others off the hook. They're going to get sued over **** like this, not to mention what it does to their customer base and public perception (not that they give a damn about that at this point).
It may not make a dent, but we'll be moving close to 9 figures in loans this year from them.
We have a few loans with them, and they are being dicks.
On one large loan in particular, they are not offering any relief whatsoever, while we know with certainty that on many other loans they are offering 90 day abatement of interest, or both P & I. Meaning, they are isolating certain customers who have guarantees in place while letting others off the hook. They're going to get sued over **** like this, not to mention what it does to their customer base and public perception (not that they give a damn about that at this point).
It may not make a dent, but we'll be moving close to 9 figures in loans this year from them.
I understand that student loans are a mess now, but back in the 60s when I was in school they were fine, and interest was very low. They were federal then. I don't think they charged any interest at all while I was in school, then it was way below market when I got out. It was a good way to go then.
This is the right answer. You can’t blame banks for taking care of their customers first, especially the larger customers. If you run a business you take care of the people who keep the doors open.
Financial institutions do this because thy can get away with it. Did anyone at Wells Fargo face criminal prosecution for their earlier misdeeds? No. Some were fined and banned from banking but I'm sure they sauntered off into the sunset with a nice nest egg tucked away. Did any of the folks responsible for the 2008 bailouts face any criminal charges? Once again, no. And they too rode off into the sunset AND paid themselves huge bonuses with taxpayer paid relief money.
The only way to stop some of these m-f'ers is to lock their asses up, strip them off their ill gotten assets and disburse said assets to those of us they screwed over.
The only way to stop some of these m-f'ers is to lock their asses up, strip them off their ill gotten assets and disburse said assets to those of us they screwed over.
Most banks wouldn’t (or rather, shouldn’t) lie to the public and say that applications will be processed on a “first come, first served” basis, and then shuffle bigger applications to the front of the line to goose their profits on the deal. Potentially, their actions have caused some small businesses to have to close.
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