Wachovia raises loan standards
Wachovia Corp. is revising the underwriting policies in its mortgage loan business, a step that could make it harder to take out a home loan at the nation’s fourth-largest bank.
The Charlotte, N.C.-based company said the new guidelines for its portfolio loans, or those it keeps on its books, take effect this month. They are aimed at reducing Wachovia’s exposure to risky home loans that tend to lead to foreclosures.
“We want to ensure Wachovia maintains strong credit quality and we are making sure we’re putting customers in the right loans,” Wachovia spokesman Don Vecchiarello said.
Among the changes, the bank will now require borrowers to have a minimum qualifying FICO score, a credit rating system used by the vast majority of the nation’s banks to guide their loan decisions. Wachovia did not disclose the minimum credit scores it would require.
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