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Thursday, February 28, 2008

Wells Fargo: New Tighter Mortgage Guidelines

by Calculated Risk on 2/28/2008 04:25:00 PM

Blown Mortgage has the details: Wells Fargo Names Most of California Severely Distressed

Wells Fargo has named nearly every California county a “Severely Distressed Market” which requires LTV reductions of 5% for any conforming loan over 75% LTV and also eliminates financing over 75% LTV for any non-conforming loan. The Wells Fargo Mortgage Express product (which is Wells Fargo’s stated income/stated asset program) is also not permitted in “Severely Distressed Market” areas.

Look for the rest of the market leaders to quickly follow suit. This immediately puts a huge swath of the state with increasingly limited refinance options. A huge portion of California loans are of the non-conforming variety and well over the 75% LTV mark ...
And from the Wells Fargo tightens mortgage guidelines (hat tip Michael)
The tougher lending standards take effect Feb. 29 ...

Twenty counties in California, including Los Angeles County and Orange County, are on the severely distressed markets list. At-risk markets around the country include 33 in Florida, 15 each in Michigan and Virginia, and 13 each in Maryland and Ohio. Many other states, including Arizona, Colorado, Connecticut, Louisiana, Massachusetts, Minnesota, New York, Nevada, New Jersey, Washington and Wisconsin had markets on the list.