Housing Market is Improving According to Wells Fargo CFO

By Stevie Duffin Updated on 9/25/2013

Timothy Sloan, CFO of Wells Fargo, stated in an interview on CNBC that the stability of the housing market was slowly improving  Despite reporting this, he also stated that this is not something we can be certain of until “we look in the rearview mirror a few months from now.”

With the credit quality of the average person steadily increasing, Sloan feels that the consumer is doing a little bit better overall. The unemployed population have continued to take the heaviest toll while everybody else is simply “doing OK.”

Wells Fargo’s mortgage industry is expanding, having clinched one third of the business in the fourth quarter. Sloan attributed refinancing to be the source for the majority of the mortgage.

His praise, however, was met with apprehension. Sloan claimed, “It’s a cyclical business so we know it is going to come down somewhat over time.”

Wells Fargo’s mortgage originations amounted to $129 billion during the first quarter, rising $75 year over year (with 15% coming from workouts from the Home Affordable Modification Program, according to Sloan). The newest version of this program is commonly referred to as HARP 2 Refinance Program, which allows homeowners who are underwater to refinance their mortgages. The bank will continue to allow itself to offer an increase in mortgages this year as the darkest hour of the housing crisis settles in.

Friday, Wells Fargo reported an earnings value of $4.2 billion during the fourth quarter, equivalent of 75 cents per share, slightly more than the analyst consensus of 73 cents per share.