Executive Summary
North Carolinians face increasingly unaffordable costs for housing that hinder prospective homebuyers’ efforts to fulfill the American dream of homeownership. Long-standing structural racism in residential housing, including redlining and mortgage discrimination, created barriers to homeownership for people of color—especially those from low-income backgrounds—that exist to this day.
Ongoing racial disparities in homeownership rates and wealth built through homeownership are major drivers of the persistent racial wealth gap in the United States. Homeownership can be a major component of household wealth accumulation, as homeowners build wealth by paying down their mortgage and through home price appreciation. Equitable and fair access to home mortgage credit is critical to narrowing this racial wealth gap and enabling people to build wealth and invest in their own and their families’ futures.
Wells Fargo is one of North Carolina’s biggest banks and mortgage lenders, but its mortgage business in the state exhibits patterns of racial disparities that disadvantage Black, Latino and Asian families trying to secure housing stability and build household wealth through homeownership. These racial disparities are compounded by Wells Fargo’s sharp decline in mortgage lending, with its North Carolina mortgage applications and loan originations dropping by more than 70% between 2020 and 2024.
This report describes the results of a detailed analysis that examined nearly 24,600 Wells Fargo conventional home purchase mortgage applications and more than 16,000 mortgage loan originations in North Carolina over the five-year period from 2020 through 2024. The analysis covered Wells Fargo’s mortgage business statewide and in the metropolitan areas within North Carolina, producing the following findings:
- Wells Fargo’s pattern of racial disparities in applications and loans suggested that it underserved Black and Latino families in North Carolina. Wells Fargo exhibited a pattern of racial disparities in taking applications from Black and Latino families and making mortgage loans to these applicants. Only 15.0% of Wells Fargo mortgage applications were from Black (7.2%) or Latino (7.8%) applicants between 2020 and 2024—far below their share of the adult population (20.7% and 8.9%, respectively; 30% in total). Only 13.3% of Wells Fargo’s mortgage loans went to Black (6.4%) and Latino (6.9%) applicants over this period.
- Wells Fargo’s pattern of racial disparities in applications and loans suggested that it underrepresented the Black and Latino populations in the Charlotte metro area. Black adults make up 22.9% of the population of the metropolitan area of Charlotte—North Carolina’s biggest city—but they composed less than one-tenth of Wells Fargo’s applicants and loan originations in the area (8.2% and 7.1%, respectively). Latino adults make up 11.0% of the Charlotte population but represented only 7.4% of Wells Fargo’s applicants and 6.6% of its loan originations. (The analysis looks at data for other North Carolina metropolitan areas in Section II.A, and data for all metro areas are available in Appendix Table 1.)
- Wells Fargo’s pattern of racial disparities in applications and loans suggested that it underserved North Carolina communities of color and focused on upper-income white communities. People of color compose the majority of the population in 27.3% of North Carolina census tracts, but Wells Fargo took only 15.4% of its mortgage applications and made only 14.3% of its loans in these areas. Predominantly white areas were overrepresented in Wells Fargo’s applications and loans, but the overrepresentation was most dramatic in the wealthiest areas. Wells Fargo took 47.3% of its applications and made 49.3% of its loans in the 13.2% of the census tracts that were upper-income and where white individuals make up the majority of the population—a nearly fourfold overrepresentation. These patterns are consistent in Charlotte, and Wells Fargo underperformed peer banks in mortgage activity in census tracts where people of color make up the majority of the population (see Section II.B).
- Wells Fargo’s lending in North Carolina showed a pattern of racial disparities in mortgage loan denial rates. Wells Fargo rejected Black, Latino and Asian mortgage loan applicants in North Carolina more than twice as frequently as it rejected white applicants. Wells Fargo rejected 22.5% of Black applicants, 25.6% of Latino applicants and 20.3% of Asian applicants, compared with 10.3% of white applicants between 2020 and 2024. (The report discusses the much higher racial disparities in some metropolitan areas in Section II.C, and data for all metro areas are available in Appendix Table 2.)
- Wells Fargo mortgage denial rates for Black and Latino applicants increased between 2020 and 2024. Wells Fargo’s denial rates rose about 20% for Black and Latino applicants between 2020 and 2024, rising from 21.2% to 25.6% for Black applicants and from 25.0% to 29.8% for Latino applicants. Over the same period, denial rates for white applicants increased by only 11%.
- Wells Fargo’s pattern of racial disparities in loan denial rates persisted even between borrowers in the same income bands. The disparities in Wells Fargo’s loan denials in North Carolina occurred at every income band level. Upper-income Black, Latino and Asian applicants (14%, 15% and 17%, respectively) were rejected more than twice as frequently as upper-income white applicants (7%) and were even rejected more frequently than moderate-income white applicants (13%). Similar patterns existed across metropolitan areas in North Carolina, and the disparities in Wells Fargo’s denial rates even for borrowers of similar incomes were larger than at peer banks (see Section II.D and Appendix Table 3).
- Wells Fargo charged higher interest rates for Black and Latino borrowers than white borrowers at every income level, raising costs and reducing household wealth for people of color in North Carolina. Wells Fargo charged higher interest rates for Black and Latino borrowers than white borrowers at almost every income level in 2020 and 2021 (when Wells Fargo was making more loans and interest rates were stable and low) (Section II.E). Middle-income Black borrowers received interest rates that were 5% higher than rates for middle-income white borrowers, despite having comparable average incomes and financial profiles, that would cost average Black borrowers $10,500 more over the life of the loan. Had Black borrowers not faced these added costs, an additional $10,500 would amount to a 24% increase in the typical Black household’s $44,000 net worth in 2022.
Wells Fargo’s pattern of racial disparities across multiple mortgage loan metrics raises significant concerns about its commitment to serve all North Carolinians and all North Carolina communities by providing equitable access to affordable home purchase mortgage credit. These disparities are part of the barriers to homeownership that people of color face and that contribute to the persistent racial wealth gap in the United States.
Americans for Financial Reform Education Fund is a nonprofit, nonpartisan coalition of more than 200 civil rights, community-based, consumer, labor, small business, investor, faith-based, civic groups, and individual experts. It was founded in the wake of the 2008 financial crisis and its mission is to fight to create a financial system that deconstructs inequality and systemic racism and promotes a just and sustainable economy.
NC United Power for Action / NC Industrial Areas Foundation is a statewide multi-racial network of faith institutions, community organizations, and neighborhood groups in North Carolina that builds grassroots leadership and organizes collective action to win concrete improvements in people’s lives. We are affiliated with the Industrial Areas Foundation, the oldest and largest citizen’s power network in the United States.
Organized Power In Numbers (OPIN), a fiscally sponsored project of the Working Families Organization, works at the intersection of worker power and modern digital and data-driven organizing. OPIN helps movements reach millions of people, invite them into the movement, and level up campaigns that win for workers, their families, and their communities in the Sunbelt. Since 2020, OPIN has engaged with thousands of working-class people in North Carolina regarding employment issues, economic struggles and civic engagement. Currently, OPIN provides technical support to convene community and labor partners to make strategic alignments that build power for all working people in North Carolina.
UNITE HERE North Carolina is an active union with a growing membership of hospitality service workers across the state dedicated to improving our lives, out civil rights, our communities, and our workplaces. We are part of a regional effort to Organize The South with 25,000 new regional members in our ranks. We work in food service and housekeeping jobs at universities, corporate cafeterias, airports, hotels, stadiums, and casinos. We are proud to stand with allies in the labor movement as well as broader social and economic justice movements that reflect our collective interests. We are on the front lines for one another seeking justice and fairness on issues such as immigrant rights, LGBTQ rights, affordable housing, and fair banking practices.