May 25, 2026
A massive new mortgage assistance program coming from Wells Fargo & Co. could soon help low- and moderate-income homebuyers in more than 50 U.S. areas; and Americans from Atlanta to Seattle can see whether their community made the list.
Wells Fargo has agreed to launch a $100 million borrower assistance program after settling a bombshell lawsuit that accused the company’s board of failing to properly oversee lending practices. The banking giant is being accused of “widespread and systematic discrimination in lending,” according to the complaint.
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The settlement, which was recently approved by a federal judge in California, comes after four years of legal disputes involving Wells Fargo shareholders, former employees and job applicants who accused the bank of systemic problems in both lending and hiring practices.
While Wells Fargo denied wrongdoing, the company agreed to the deal to avoid prolonged litigation and mounting legal costs.
For potential buyers struggling with sky-high home prices, stubborn mortgage rates and steep closing costs, the settlement could be a rare opportunity for financial relief.
Explosive allegations over lending practices
The case centered on allegations that Wells Fargo’s board failed to maintain adequate oversight of the bank’s mortgage lending operations, exposing the company to regulatory scrutiny and accusations of discriminatory practices.
According to reporting from Realtor.com, plaintiffs accused the bank of “widespread and systematic discrimination in lending” and cited concerns over lending algorithms and refinancing approval patterns. (1)
The lawsuit stated that Wells Fargo was allegedly the only major lender in 2020 to reject more refinancing applications from Black homeowners than it approved.
Former employees also allegedly raised internal concerns about company culture and lending disparities.
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“It’s the culture at the root of the company,” one former employee reportedly told the plaintiffs’ private investigator.
The lawsuit was ultimately consolidated into a shareholder derivative action in federal court in California, meaning shareholders sued on behalf of the company itself, accusing directors and executives of breaching their fiduciary duties. Motley Rice LLC, Cotchett Pitre & McCarthy LLP, and Bleichmar Fonti & Auld LLP were the legal counsel for the plaintiffs.
Under the final settlement: (2)
- Wells Fargo will establish a $100 million mortgage assistance fund
- The program will run for three years
- Directors will pay an additional $10 million to shareholders
- Low- and moderate-income borrowers in eligible communities may qualify for mortgage grants and closing cost assistance
Judge Trina Thompson called the program “a meaningful step toward expanding equitable access to financial services.” (1)
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“Often, the largest asset a person or family has is a home,” added Motley Rice attorney Marlon Kimpson. “This case alleged Wells Fargo systematically locked out people of color and marginalized families, preventing them from pursuing the American dream. This settlement delivers real, tangible benefits.” (3)
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Is your city on the list?
The borrower assistance programs will be available across various metropolitan areas throughout the country.
Communities eligible for both mortgage assistance grants and closing cost assistance include: (3)
- Charlotte-Concord-Gastonia, NC-SC Metro SA
- Chicago-Naperville-Schaumburg, IL Metro Division
- Dallas-Plano-Irving, TX Metro Division
- Denver-Aurora-Centennial, CO Metro SA
- Fort Lauderdale-Pompano Beach-Sunrise, FL Metro Division
- Fort Worth-Arlington-Grapevine, TX Metro Division
- Jacksonville, FL Metro SA
- Lakewood-New Brunswick, NJ Metro Division
- Los Angeles-Long Beach-Glendale, CA Metro Division
- Marietta, GA Metro Division
- Miami-Miami Beach-Kendall, FL Metro Division
- Minneapolis-St. Paul-Bloomington, MN-WI Metro SA
- Montgomery County-Bucks County-Chester County, PA Metro Division
- Nassau County-Suffolk County, NY Metro Division
- New York-Jersey City-White Plains, NY-NJ Metro Division
- Newark, NJ Metro Division
- Oakland-Fremont-Berkeley, CA Metro Division
- Orlando-Kissimmee-Sanford, FL Metro SA
- Philadelphia, PA Metro Division
- Phoenix-Mesa-Chandler, AZ Metro SA
- Portland-Vancouver-Hillsboro, OR-WA Metro SA
- Raleigh-Cary, NC Metro SA
- Richmond, VA Metro SA
- Riverside-San Bernardino-Ontario, CA Metro SA
- Sacramento-Roseville-Folsom, CA Metro SA
- San Diego-Chula Vista-Carlsbad, CA Metro SA
- San Francisco-San Mateo-Redwood City, CA Metro Division
- San Jose-Sunnyvale-Santa Clara, CA Metro SA
- Seattle-Bellevue-Kent, WA Metro Division
- Tampa, FL Metro Division
- Trenton-Princeton, NJ Metro SA
- Vineland, NJ Metro SA
- Washington, DC-MD Metro Division
- West Palm Beach-Boca Raton-Delray Beach, FL Metro Division
- Wilmington, DE-MD-NJ Metro Division
Meanwhile, seven additional metro areas will qualify specifically for closing cost assistance only, including: (3)
- Albuquerque, NM Metro SA
- Cape Coral-Fort Myers, FL Metro SA
- Columbia, SC Metro SA
- Houston-Pasadena-The Woodlands, TX Metro SA
- Las Vegas-Henderson-North Las Vegas, NV Metro SA
- Oxnard-Thousand Oaks-Ventura, CA Metro SA
- Salt Lake City-Murray, UT Metro SA
The bottom line
The case, formally known as In re Wells Fargo & Co. Hiring Practices Derivative Litigation, is shaping up to be one of the most closely watched banking settlements tied to fair lending practices in years.
And for thousands of would-be buyers who’ve been priced out of the market, the new assistance programs could offer something that’s become increasingly harder to find in today’s housing market: a realistic path to homeownership.
Article Sources
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Realtor (1); Motley Rice (2, 3)
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Freelance writer with an economic development and consulting background.
