Wells Fargo is raising interest rates by 3%



image  Attention, shoppers. Wells Fargo is raising interest rates for most of its credit card customers.

Cardholders are getting the word this week of a 3 percent increase going into effect Nov. 30. "This is something we’ve been contemplating for quite a period of time," Kevin Rhein, group head of card services, told Bloomberg News. "We had just reached the point that we don’t think we can offer credit cards at the current pricing and keep credit flowing."

That may come as a surprise to D.C. lawmakers who had asked credit card issuers to refrain from such a move until a new law curbing rate increases on existing balances took effect. House Financial Services Committee Chairman Barney Frank is scheduled to hold a hearing today on making the law – the Credit Card Accountability, Responsibility and Disclosure Act – effective as of Dec. 1.
Rhein didn’t comment to Bloomberg on whether the timing of the law had a bearing on the timing of the rate increases.
Bank of America, which raised some rates in June, said earlier this month that it would not raise rates further on credit-worthy customers until the law took effect. JPMorgan Chase raised rates and fees and imposed higher minimum monthly payments in May.

Trying harder: Wells Fargo has previously taken a beating over the paucity of its contribution to the Obama administration’s $50 billion foreclosure prevention program. "We know we’ve fallen short of our customer service goals in some cases," Mike Heid, co-president of the bank’s home mortgage division, said in August. He promised to do better.

As of Sept. 30, Heid said, his division had almost doubled the start or completion of loan modifications under the program to 63,000. This in addition to the 292,000 started and completed modifications initiated outside the government program. "We have remained focused on exceeding our share of the government’s goal to reach 500,000 (modifications) by Nov. 1," Heid said in a statement Thursday.

In fact, that goal was reached Thursday, according to the Obama administration. Most would agree, however, the foreclosure crisis is far from over. "Using (the government program) and our own programs, there is still much work ahead to preserve homeownership and to further reduce the number of foreclosed properties on the market," Heid said.

Win some, lose some: More than 11,000 San Francisco homeowners are getting property tax reductions this year, after the city’s assessor-recorder determined the current market value of their homes is less than their officially assessed value.

That’s good news for the homeowners, though not so much for the city’s coffers, which will sacrifice $16.4 million as a result. "Our office has witnessed an exponential increase in requests for property tax reductions this year," said Assessor-Recorder Phil Ting. Not surprising, seeing as San Francisco has been hit by the housing crash, if not nearly as badly as other places.

A geographical breakdown of the 2009-10 reductions provided by the assessor’s office suggests some neighborhoods have been hurt more than others. Mission Bay, South Beach, SOMA and Potrero Hill accounted for the highest percentage of reductions. On the other end of the scale: the Marina, Cow Hollow and Pacific Heights.

One data point of note: While California experienced its first overall year-to-year decline in assessed property values since records were first kept in 1933, San Francisco saw a 7.1 percent gain, the highest of all 58 counties, according to the state Board of Equalization. Go figure.

Crystal balling: The outlook for home sales in 2010? Up and down, according to the California Association of Realtors.

Up, as in a $280,000 median price for detached, single-family homes statewide, a 3.3 percent increase compared with 2009’s 22 percent fall. Down, as in a 2.3 percent drop in sales, to 527,500. "The demand for properties in fairly good condition exceeds the supply," explained CAR’s chief economist, Leslie Appleton-Young. According to the association’s president, James Liptak, 2010 will "mark the beginning of the ‘new normal’ for California’s housing market."

More normal than the wild ups and downs California is know for, we presume.

Source http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/10/08/BUF11A2JNI.DTL

ECJ




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