Wells Fargo & Company (NYSE: WFC) is a bank holding company that provides diversified financial services. The company’s home-lending business unit offers mortgage and home-equity loan solutions to customers in the United States.

Who They Are

Wells Fargo was founded in 1852 in New York City by Henry Wells and William Fargo. The initial goal was to provide banking and express services to western pioneers to help link the eastern and western United States. For this reason, the bank is considered a pioneer of frontier commerce. The company now provides a wide variety of financial services that include banking, insurance, wealth and investment management, mortgage, leasing, credit cards and consumer finance to one in three households in the United States. Wells Fargo had a market capitalization of $252.76 billion, as of May 2, 2016.

Mortgage Products Offered

Wells Fargo's key mortgage products include fixed-rate loans, adjustable-rate mortgages (ARMs), Federal Housing Administration (FHA) loans, Veteran Affairs (VA) loans and jumbo loans.

A fixed-rate loan's interest rate remains constant throughout the duration of the loan. This loan type is appealing for customers that want consistent monthly payments. It may be suitable in a rising interest rate environment. Wells Fargo offers a variety of loan terms for this product.

ARMs offered by Wells Fargo provide a fixed interest rate for three, five, seven or 10 years. At the conclusion of the fixed term, the interest rate varies each year based on a credit market index. Key features of the product include a typically lower interest rate than a fixed-rate mortgage and additional flexibility for customers who expect future income growth, plan to relocate or will want to refinance in the next two to five years.

Wells Fargo offers FHA loans that are insured by the FHA and the federal government. Features of the product include low down payments and closing costs. The loan is typically easier to qualify for than a conventional mortgage and is open to all income levels.

Wells Fargo provides VA loan financing for veterans, reservists, active duty personnel and the families of these groups. Loans are offered in a variety of fixed-rate and adjustable-rate options. They are guaranteed by the Department of Veterans Affairs and typically have minimal out-of-pocket expenses with seller contributions.

Jumbo loans offered by Wells Fargo are mortgages tailored to the individual customer. Special features include borrow amounts above the maximum conforming loan limits and the availability of various fixed-rate and adjustable-rate options.

Wells Fargo also provides customers with refinancing and home equity products.

Mortgage Rates

As of May 2, 2016, Wells Fargo offered a 30-year fixed-rate loan at an interest rate of 3.875% and an annual percentage rate (APR) of 3.904%. The bank’s 15-year fixed-rate loan was offered at an interest rate of 3.125% and an APR of 3.176%.

The 30-year FHA fixed-rate loan had an interest rate of 3.75% with an APR of 4.758%. The 30-year VA fixed-rate loan had an interest rate of 3.5% with an APR of 3.786%.

The bank’s 7/1 ARM loan had an interest rate of 3.375% with an APR of 3.48%. Its 5/1 ARM loan had an interest rate at 3.125% with an APR of 3.417%. Wells Fargo offers the 5/1 ARM VA loan with an interest rate of 3.125% and APR of 2.835%.

The APR includes the interest rate, points, broker fees and other miscellaneous charges required to secure the loan.

What Consumers Are Saying

Lending Tree Inc. (NASDAQ: TREE), an online lending exchange that connects consumers with a multitude of lenders, gives Wells Fargo two stars out of a possible five-star rating, derived from 59 consumer reviews. The reviews have a theme of poor customer service and lack of responsiveness. Positive reviews highlighted competitive interest rates and costs.

Wells Fargo receives a one-star rating out of a possible five-star rating from the Consumer Affairs website. The general consensus from the 151 ratings is that the company could improve it general customer service and communication process with customers.

Wintrust Mortgage Overview (WTFC)

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