Warren slams Wells Fargo decision to close customer credit lines
Sen. Elizabeth Warren (D-Mass.) blasted Wells Fargo’s decision this week to close customers’ personal credit lines.
CNBC reported on Thursday that the bank alerted customers that existing lines of personal credit would be closed in the next few weeks and it was no longer offering the consumer lending product.
The letter also reportedly said that these closures “may have an impact on your credit score,” which was included in a frequently asked questions portion of the letter, CNBC reported.
“Not a single @WellsFargo customer should see their credit score suffer just because their bank is restructuring after years of scams and incompetence. Sending out a warning notice simply isn’t good enough – Wells Fargo needs to make this right,” tweeted Warren, who has been critical of big banks.
Not a single @WellsFargo customer should see their credit score suffer just because their bank is restructuring after years of scams and incompetence. Sending out a warning notice simply isn’t good enough – Wells Fargo needs to make this right. https://t.co/wyuuY2WEk5
— Elizabeth Warren (@SenWarren) July 8, 2021
Previously, customers were able to draw thousands to tens of thousands of dollars in personal lines of credit to pay for things such as home renovations or to combine credit card debt with high interest rates.
In 2018, the Federal Reserve told the bank it could not grow its balance sheet following a fake accounts scandal in 2016.
CNBC noted that with less credit available for a customer to use, it would likely mean that customers would have to draw more from available credit and hurt their credit score.
In a statement to The Hill, Wells Fargo spokesman Manny Venegas declined to comment on Warren’s tweet but stated: “As we simplify our product offerings, we made the decision last year to no longer offer personal lines of credit as we feel we can better meet the borrowing needs of our customers through credit card and personal loan products.”
“We realize change can be inconvenient, especially when customer credit may be impacted. We are providing a 60-day notice period with a series of reminders before closure, and are committed to helping each customer find a credit solution that fits their needs,” he added.
Venegas said that information regarding customers’ credit scores had been included “because we know that with the closure of any type of financial product, a customer’s credit may be impacted.”
“We want to ensure customers are aware of this so they can monitor…Wells Fargo does not determine or know what factors are used to calculate an individual credit score; therefore, we are not able to estimate what, if any, impact this closure will have on a customer’s individual credit score,” he added.
Venegas said the bank recommends customers make scheduled payments on time “to ensure positive (paid as agreed) credit bureau reporting.”
Updated to 7:25 p.m.