The Bagel logo
  • Ryan Wittler

Wells Fargo Rejected Half of Its Black Applicants During 2020’s Mortgage Refinancing Boom


A new analysis by Bloomberg News found Wells Fargo rejected half of the Black homeowners who applied to refinance their mortgage in 2020 after the Federal Reserve slashed interest rates to historic lows.

Some highlights:

Bloomberg analyzed federal mortgage data and found Wells Fargo accepted just 47% of Black mortgage refinance applicants in 2020, compared to 72% of white applicants and 67% of Asian ones.

  • The analysis found Black applicants had lower acceptance rates than White ones at all major lenders, however, Wells Fargo had the largest disparity and was alone in rejecting more Black homeowners than it accepted.

  • The analysis also found Wells Fargo approved the highest income Black applicants at about the same rate as it did the lowest income white applicants.

The Fed began slashing rates in March 2020 as the pandemic brought the economy to a halt, kick-starting what the analysis called “a remarkable wealth event” that’s seen homeowners in the U.S. refinance almost $5 trillion in mortgages over the last two years, the most since the early 2000s.

  • White homeowners have benefitted to the tune of saving an estimated $3.8 billion annually by refinancing their mortgages in 2020.

  • Black homeowners, however, saved just $198 million, representing less than 4% of the estimated total savings.

The industry:

Bloomberg found 71% of Black applicants were approved for mortgage refinances across all other lenders, the lowest among any demographic group in the analysis.

  • To compare, across all other lenders, 87% of white, 85% of Asian, and 79% of Hispanic applicants were approved in 2020.

Bagel HQ, Los Angeles, CA