MORTGAGE UPDATE:
Lending update courtesy of MS&C Mortgage,
an affiliate of Wells Fargo

Mergers, Bailouts and Acquisitions

The financial services landscape is ever-changing in this unprecedented time in U.S. history. According to a Sept. 30 Wall Street Journal article, the banking industry has gone through a decade’s worth of consolidations in a week. (See chart on this page.)

Stand-alone large investment banks – such as Bear Sterns and Lehman Brothers – are no more. Morgan Stanley and Goldman Sachs have morphed into bank holding companies. Merrill Lynch will become part of Bank of America, as has Countrywide. Fannie Mae and Freddie Mac are under a government conservatorship. Washington Mutual has been purchased by JP Morgan, and IndyMac was seized by federal regulators. Now the European market is, with the demise of Bradford and Bingley Bank, further exacerbating the financial markets in the U.S.

Wells Fargo also recently announced a merger with Wachovia and will acquire all outstanding shares of common stock of Wachovia in a stock-for-stock transaction. In the transaction, we will acquire all of Wachovia Corporation including all its businesses and obligations, preferred equity and indebtedness, and banking deposits. The merger, which requires regulatory and Wachovia shareholder approval, is expected to be finalized by the end of fourth quarter 2008.

HOPE for Homeowners Launched Oct. 1

The HOPE for Homeowners (H4H) program, created as part of the Housing and Economic Recovery Act of 2008, allows the Federal Housing Administration (FHA) to help borrowers at risk of default or foreclosure to refinance into more affordable, sustainable loans. The program is effective Oct. 1, 2008 through Sept. 30, 2011. According to the Housing and Urban Development Web site, as many as 400,000 homeowners could avoid foreclosure through this program over the next three years.

There are four ways a distressed homeowner could pursue participation in H4H:
1. Homeowners may contact their existing lender and/or a new lender to discuss qualification and eligibility.
2. Servicers working with troubled homeowners may determine that a H4H loan may be a solution for avoiding foreclosure.
3. Originating lenders looking for ways to refinance potential customers out from under their high-cost loans and/or who are willing to work with servicers to assist distressed homeowners.
4. Counselors working with troubled homeowners and their lenders to reach a mutually agreeable solution for avoiding foreclosure.

Wells Fargo & Company is a diversified financial services company with $575 billion in assets, providing banking, insurance, investments, mortgage and consumer finance to more than 23 million customers from almost 6,000 stores and the internet (wellsfargo.com) across North America and elsewhere internationally. Wells Fargo Bank, N.A. is the only bank in the U.S., and one of two banks worldwide, to have the highest possible credit rating from both Moody's Investors Service, "AAA," and Standard & Poor's Ratings Services, "AAA." Information is accurate as of date of printing and subject to change without notice. Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. © 2008 Wells Fargo Bank, N.A. All rights reserved.