Wells Fargo & Company
) announced the launch of its CityLIFT program in Oakland during
December 7-8. The program, which is valued at $5 million, is
intended to extend down payment assistance and homebuyer
education programs in the Eastern Bay region.
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As per the program, Wells Fargo will provide $20,000 to qualified
buyers for a down payment. The bank will also offer a viewing
center so that buyers can undertake virtual tours of homes they
might want to buy within the nine East Bay cities. These cities
include Oakland, Fremont, Hayward, Concord, Antioch, Bay Point,
Brentwood, Pittsburg and Richmond.
In order to qualify for down payment assistance, applicants are
required to fulfill certain criteria, such as annual income not
exceeding 120% of the median income for the area. Further,
prospective buyers need to complete an eight-hour homebuyer
education session with a HUD-approved counselor, such as The
Unity Council. In addition, the buyers are required to commit
that they would stay in the house for five years. The company
anticipates about 250 homebuyers to benefit through this program.
Wells Fargo unveiled CityLIFT to provide down payment support and
homebuyer education programs in areas that are highly affected by
the financial crisis. The program was developed in connection
with the settlement with the U.S. Department of Justice in 2012.
Also, the program is an alliance between Wells Fargo Bank N.A.
and NeighborWorks America.
The company has already launched this program in the cities of
Atlanta, Chicago, Houston, Jacksonville, Las Vegas, Los Angeles,
Miami, Orlando, Philadelphia, Phoenix, Sacramento, Tampa, Twin
Cities and Washington, D.C. Nearly 785 buyers have been benefited
by CityLIFT in these cities along with an estimated 546 probable
buyers on the verge of inking the deal.
Besides East Bay, Alameda and Contra Costa counties are also part
of the twenty housing markets that will benefit from a total of
$170 million, which Wells Fargo has committed through its LIFT
programs (including NeighborhoodLIFT and CityLIFT) to support
sustainable housing in cities affected by the economic crisis.
Such initiatives by Wells Fargo would help homebuyers achieve
sustainable homeownership. Moreover, these actions will boost the
company's loan portfolio.
Wells Fargo currently retains a Zacks #3 Rank, which translates
into a short-term Hold rating. We believe that these initiatives,
though positive, are unlikely to result in powerful upward
estimate revisions for the stock. Another financial institution
in the same sector namely
JPMorgan Chase & Co.
) retains a Zacks #2 Rank (translating into a short-term Buy