Wells Fargo announced that it would stop offering personal lines of credit and is shutting those current accounts.
The product allowed users to borrow between $3,000 and $100,000, and was intended to consolidate higher-interest credit-card debt, pay for home renovations and avoid overdraft fees on linked accounts.
"Wells Fargo recently reviewed its product offerings and decided to discontinue offering new Personal and Portfolio line of credit accounts and close all existing accounts,” the bank said in a six-page letter (ass reported by CNBC).
In 2018, the Fed imposed caps on Wells Fargo balance sheet until it fixes compliance shortcomings revealed by Wells Fargo’s fake accounts scandal. However, the bank didn’t directly answer questions as to whether the Fed’s asset cap had a role in its latest decision.
Wells Fargo warned customers that the account closures “may have an impact on your credit score,” according to the letter.