MEMPHIS, TN (abc24.com) - It's accused of helping tank the Mid-South housing market, now Wells Fargo is investing millions to get it back on track.
The bank claims it will devote $425 million in new home loans in Memphis over the next five years. It's part of an agreement so Memphis and Shelby County will drop their lawsuit against the bank for predatory lending.
Of that $425 million, about a quarter of it will be set aside for low and moderate income home buyers. If it works as planned, Memphis and Shelby County could see a major residential and commercial real estate turnaround.
“We've been here since '68, so a long time. We love our neighborhood. Very sad that so many people had to lose their homes,” said homeowner Ledell Windless.
Wells Fargo is trying to get people back in them. The bank set aside more than $4 million for down payment grants worth up to $15,000 each.
“The impacts are on many fronts, obviously to the individual who qualifies and gets up to 15 thousand dollars in down payment assistance, that's obvious - you can see that, that's the American dream,” said Memphis Mayor A C Wharton.
A few years ago it was more like a nightmare, due to Wells Fargo and its reported practices of predatory lending, the city and county alleged.
Thos practices, according to a lawsuit filed by the City of Memphis and Shelby County, resulted in several families losing their homes when the economy crashed.
Felicia Hartsfield of Influence 1 Community Development Corporation says it hit South Memphis hard.
“The foreclosures, people losing their homes and leaving them, that impacted this area tremendously so we're hoping that this settlement is going to help bring things back to life,” Hartsfield said.
“The housing crisis took place around the country and affected many cities such as Memphis, so we want to play our part to ensure that we help get folks back into these homes and get these communities built back up,” said Wells Fargo Regional President Leigh Collier.
That part also includes $3 million to the city to help crack down on gun violence and help develop small businesses and bring them to distressed neighborhoods, “So it gets an individual into a home and at the same time we're enhancing the whole neighborhood,” Wharton said.
“This my house. I live at 826 East Gage,” said Windless, proudly showing off her house.
Pretty soon, many more could say the same.