Wells Fargo Backs Government Foreclosures Program

Wells Fargo, one of the country’s largest mortgage lenders, is partnering with cities and nonprofit organizations to help implement the government foreclosure homes program through its own First Look program.

First Look is a program created by the National Community Stabilization Trust to facilitate the transfer of lender-owned properties to community housing organizations in partnership with city and state government foreclosures programs.

The program will use the $3.9 billion funding provided by the federal government under the Housing and Economic Recovery Act. Wells Fargo has also added its own funding of $2 million to the program.

Under the First Look program, nonprofits, local officials and real estate agents will be helped by Wells Fargo in the sale of vacant foreclosure properties to first-time homebuyers and new owners. In addition, the bank will also provide responsible home ownership training before giving loans to qualified borrowers.

In cooperation with government foreclosures program officials, Wells Fargo chose the Twin Cities of Saint Paul and Minnesota for the pilot stage of the First Look program.

According to Joe Obayon, top executive for community servicing for Wells Fargo Home Mortgage Servicing, said Wells Fargo is supporting government foreclosures programs in order to hasten the recovery of the housing market and the national economy.

He said if Wells Fargo cannot find a sustainable option for a distressed borrower, then the lender would find a way to mitigate the effects of foreclosure by making sure that the foreclosed home does not contribute to neighborhood blight and deterioration of home values.

Wells Fargo also has opened its Wells Fargo Housing Foundation services to housing nonprofits and other entities that are carrying out government foreclosures programs. Through the foundation’s services, housing nonprofits can buy real estate owned homes at a discount from the bank and then rehabilitate them for their own home ownership programs. The only requirement is the tax-exempt status of the nonprofits under the Internal Revenue Service.

Wells Fargo said that it has helped over 706,000 homeowners from foreclosure under its own programs in partnership with government foreclosures programs from 2007 to 2008. It has also been in the forefront of efforts to help government foreclosures programs run by the Department of Housing and Urban Development, the U.S. Treasury and the HOPE NOW since 2007.

By Cassiano Travareli