Wells Fargo Bank leaves me scratching my head. Here is a bank that has ripped off customers in the past. They committed fraud against their customers by opening up accounts in their customers’ names without authorization. This bank opted-in their customers on certain products without their knowledge. The list of infractions is long. Yet, people still do business with them, and they are a viable bank as far as we know.
Where do you get to rip off customers all in the name of profit and stay in business?
The actions they took the other day seemed to be yet another violation against their customers. Within 60 days, all lines of credit will be shut down. If you have an unused line of credit, it will be gone. Yesterday, I wrote what this move does to credit scores.
Why make the move in the first place? If conditions called for it and other banks were doing the same, it would be understandable. All we can do is speculate – here are some potential reasons:
All of the banks are doing it – All the banks are loaning money by truckloads. They certainly are not taking credit away.
Bad underwriting -Maybe they lowered their credit standard for this product and they are reducing risk.
Higher interest rates - Maybe this allows the bank to lock in the remaining debt on the credit lines at higher interest rates. One article suggested a range of 9% to 21%.
They see signs of problems for the big bank – You can’t rule that out.
When is enough, enough?
Grant it; I do appreciate what a hassle it is to move bank accounts. Please know that small and regional size banks understand how to take care of customers the right way and consider it a blessing to have your account rather than an opportunity to profit.
Need a second opinion about money and investment issues? Just ASK BOB! Bob is available and always happy to share his views.
Bob Brooks is a Financial Adviser and host of the daily Radio Show. The Prudent Money Radio show airs at 3 PM CST on 91.3 FM, 97.5 FM, and 99.9 FM in the Dallas Forth Worth metroplex. Visit www.prudentmoney.com for further details. You can reach Bob at 972-386-0384 and by emailing firstname.lastname@example.org.
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