Wells Fargo has seen some improved earnings this quarter. But, the lender continues to face major losses from home equity line of credit customers.

Market Watch reports:

“Within Wells Fargo’s $84 billion home equity portfolio, 2.11% of loans had two or more payments that were late at the end of June. That’s up from 1.86% at the end of March.

 

The bank separated some of the worst-performing parts of its home equity portfolio earlier this year and plans to slowly liquidate them. This $11 billion portion had 3.6% of loans with two or more payments past due at the end of the second quarter. That was up from 2.79% at the end of the first quarter.

 

“Given the continued decline in home prices, we had more accounts move into the higher combined loan-to-value segments, which directly impacts loss levels,” Loughlin explained.”

Over two out of every 100 Wells Fargo customers has had two or more late payments between the beginning of April and the end of June. Wells Fargo has frozen or reduced many home equity lines to mitigate loss. But, many customers have already withdrawn an amount greater than the current value of their property.

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Tags | Heloc, heloc freeze, home equity line of credit, mortgage crisis, Wells Fargo