It has been recently disclosed by sources privy to the development that Wells Fargo has decided to let go of many auto dealerships across the United States. Wells Fargo, a well known auto lender has issued letters to the auto dealerships that they will not be a customer to Wells Fargo anymore as they are being dropped.
The buyers who were looking for getting a car from these dealerships with loan facility from Wells Fargo will have to go through some more documentary formalities and may have to settle for some other loan arrangement. As the number of the dealers that are being removed from the customer base is more than 1000, the experts estimate that the Wells Fargo, already struggling with fraud allegations may have dropped more than 10 percent of its total customers. However, the most affected customers from this decision will be the ones who are interested in buying a used car as compared to the ones who are looking to buy a new car.
Wells Fargo on the other hand has issued a statement that owing to the ongoing pandemic, the company is aimed at providing relief to its long term customers by making deferred payments possible. But with this, the company has announced that they will be terminating their services with the customers with whom the company does not have a mutual trust for a longer period of time. In this situation the company has informed that they had to review their model of doing business and therefore a decision has been taken to inform such customers that their requests for loans will not be entertained at Wells Fargo anymore.
According to the figures published by Wells Fargo, the company does business with more than 11000 auto dealerships across the country. This recent decision will be crucial to their business model as it is going to affect an estimated 10 percent of their customers. However, for the buyers who are looking to buy cars from these auto dealerships the situation will either change completely or they will not even feel a difference while availing auto loan. If a particular dealership was working with Wells Fargo exclusively then it will cause problem for its customers to get quick deals from banks and for those banks to sign up that particular auto dealership as their customer. On the other hand if a dealership had more than one auto financing services as their clients then buying a car will be usual business for their customers as there is going to be hardly any difference in procedure.
Wells Fargo has been in hot waters since 2018 when it was fined a hefty billion dollar penalty under the Consumer Financial Protection Act. According to the court ruling, Wells Fargo made it obligatory for its clients to sign up an insurance which was not necessarily of any good to them. Recently, Wells Fargo had agreed to pay 3 billion dollars to settle numerous cases filed from early 2000s to 2016 for fraudulent opening of accounts in the name of their customers without obtaining consent from them.
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