The Future of Auto loans & Wells Fargo
Auto loans were once increasingly popular in the US. But after the 2008 financial crisis, governmental intervention has increased. Hence resulting in a new set of policies being implemented across the country. A major chunk of Auto loans was financed by Wells Fargo and Company. However, the change in government’s policies after the 2008 financial crisis, hit them hard.
Auto loans, before 2008, were mostly financed by Wells Fargo and Company. Wells Fargo and Company is a US-based banking holding company. It is the second largest company by market capitalization. It is the second largest bank in mortgages, debit cards, and deposits. The company was involved in a mega-scandal in 2016. The bank’s employees had created millions of fake customer accounts.
Cuts in Auto Loans
Car loans, after mortgages are the driving force behind the US economy. In the light of the 2008 aftermath, the government has something else in mind. To prevent the US economy from collapsing, state control has increased. Wells Fargo and Company were the second largest Auto loans provider in 2016. However, after a change in the Fed’s policy, Wells Fargo revised their auto loans. At present. Wells Fargo has already cut its auto loans by 30%. According to insider sources, this amount can increase. Also, many auto loan financiers have been warned about extravagant spending on auto loans. Economists believe that the automobile market can collapse anytime soon. They believe it to be so because auto loans are easy to obtain. Moreover, the auto loans are readily available on low-interest rates. Many pundits and economists compare this with the 2008 mortgage crisis. At present, it seems Wells Fargo will bring cuts in auto loan spending. Furthermore, the firm will cut down jobs as it employs a new auto loan head.