FI showroom red and grey logo
MenuMENU
SearchSEARCH

Wells Fargo: Subprime Cap Part of ‘Ongoing Risk Management’

The bank’s dealer services division responds to the reported cap the finance source has placed on subprime auto originations.

March 10, 2015
2 min to read


IRVINE, Calif. — A statement released by Wells Fargo Dealer Services didn’t deny the bank has placed a cap on subprime auto loans for this year, but it stopped short of saying the move was the bank’s response to media claims of an overheating auto finance market.

Citing unnamed executives from Wells Fargo, The New York Times reported on March 1 that the bank was limiting the dollar volume of its subprime auto originations to 10% of its overall auto loan originations. For all of 2014, Wells Fargo originated $29.9 billion in auto loans, up 8% from the previous year.

Ad Loading...

A spokesperson for Wells Fargo Dealer Services said the bank remains committed to the auto finance market and that it remains “firmly committed to responsibly offering access to credit to a wide spectrum of customers during all economic cycles.”

“The percentage of originations we consider subprime, based on our customized scorecard, has remained generally stable over the last decade,” the spokesperson said. “In the fourth quarter, we formalized our existing risk management philosophy. This is part of our ongoing risk management structure and helps us to continue to responsibly manage risk while also tailoring our approach by local market.”

The news comes at a time when several media outlets, including The New York Times, have warned that auto finance may go the way of subprime mortgage in the years leading up to the 2008 financial crisis. Some news outlets have even called on regulators to step in and stop what they called a forming subprime auto finance bubble.

Despite total outstanding loan balance on auto loans reaching an all-time high of $886 billion in the year-end 2014 quarter, finance executives at the 2015 Vehicle Finance Conference in January maintained that the market is operating smartly. They described competition as fierce but disciplined, with one executive noting that finance sources seem focused on smart structures.

Whether motivated by the media or not, state and federal regulators have keyed in on subprime originations and securitizations. Since the summer, regulators have issued subpoenas to several subprime finance sources, including Consumer Portfolio Services, Ally, Capital One, GM Financial, Credit Acceptance Corp, and Santander Consumer USA, requesting documents related to their subprime auto finance businesses.

Ad Loading...

Speaking to F&I and Showroom at the National Automobile Dealers Association’s 2015 convention, Dawn Martin Harp, who heads up dealer services for Wells Fargo, said regulators have not impacted the bank’s auto origination strategy. She did note, however, that the bank has been working to improve the information it provides to consumers regarding their loans, adding that the bank has more transparency initiatives planned for 2015.

More Auto Finance

$5 bill poking out of blue jeans pocket
Auto Finance•by Hannah Mitchell•October 14, 2026

Interest Rates Further Squeeze Auto Consumers

Last month’s hike and a potential second increase this month add to a growing list of inflation woes that could continue to dent overall car sales.

Read More →
Staircase with no rails next to red-painted wall
Auto Finance•by John Tabar•October 8, 2026

Mind Your Process

Consistent steps taken in various aspects of the F&I office can make valuable differences over time, similar to an outline for a best-selling book.

Read More →
Scrabble letter tiles spelling fraud
Auto Finance•by Gil Van Over•September 30, 2026

Top Five Credit Application Fraud Flags

Compliance audits regularly reveal bad habits that can lead to fraud charges and should have been stamped out decades ago.

Read More →
Ad Loading...
Paper money, car key fob and calculator
Auto Finance•by Hannah Mitchell•September 14, 2026

More Auto Loans for the Taking in August

Riskier categories were on the uptick for the month as lenders loosened access in several areas while balancing out the exposure in another, Cox Automotive reported.

Read More →
A fan of $100 bills sitting on a white envelope
Auto Finance•by Hannah Mitchell•August 12, 2026

July Was Hot for Auto Borrowers

Credit proved readily available for many, but most loans left buyers in negative territory, Cox Automotive said.

Read More →
stacks of coins, a calculator, paperwork, and a pair of glasses in the background, text Lender Experience Drives Dealer Decisions, F&I and Showroom
Auto Finance•by Lauren Lawrence•August 12, 2026

Dealer Lender Preferences Revealed

When lenders provide consistent, fast service, their overall satisfaction scores with dealers greatly improve, according to JD Power research.

Read More →
Ad Loading...
man sitting at desk using a calculator
Auto Finance•by Lauren Lawrence•August 10, 2026

Auto Refi Savings Surge

Consumers with 84-month auto loan terms who refinanced saved the most on monthly payments, according to a new report by auto refinancing provider Caribou.

Read More →
Tiny toy car in front of small stacks of coins
Auto Finance•by Hannah Mitchell•August 5, 2026

Subaru Enters Lending Business

The automaker follows other brands in adding captive financing in the U.S., and says the move will strengthen its position here.

Read More →
Man climbing ladder in front of mountain landscape.
Auto Finance•by Lauren Lawrence•August 3, 2026

Positive Equity Reaches Record High

Mainstream vehicle owners who bought a car seven years ago are likely to have positive equity when trading in for a new vehicle, according to second-quarter Edmunds data.

Read More →
Ad Loading...
Photo of document next to calculator and inkpen
Auto Finance•July 20, 2026

Dealerships Are Paying the Price for Extended Car Loans

Growing negative-equity scenarios mean such lengthy terms should be addressed in a forward-looking way to make them work for the dealer and the consumer down the road.

Read More →