Wells Fargo shuts down personal credit line

• Wells Fargo will no longer be offering personal lines of credit.
• The bank said that the move aims to “simplify our product offerings.”
• Clients may have to switch to smaller banks and credit unions, or consider personal loans and credit cards.

Personal lines of credit will no longer be offered by Wells Fargo Bank, according to a report from Bloomberg. The bank will close down accounts with an open credit line and no longer accept new applications.

The bank’s statement read, “In an effort to simplify our product offerings, we’ve made the decision to no longer offer personal lines of credit as we feel we can better meet the borrowing needs of our customers through credit card and personal loan products.”

These credit lines typically allow clients to borrow between $3,000 to $100,000 with a variable interest rate, to help fund major purchases like medical expenses, home improvement, debt consolidation, or seasonal cash flow.

Clients can turn to several other smaller banks and credit unions that still offer personal lines of credit.

Clients can also try switching to personal loans, which can be used for similar reasons. These usually have a lower, fixed interest rate and a set repayment period. You can check out Credible to compare the rates and payment periods of several lenders that offer quick loans.

Another alternative would be a credit card. You can compare credit card types, rewards, and fees from various creditors on Credible.

Wells Fargo also closed down its home equity lines of credit (HELOC) last year. They announced in the same year that they would stop offering auto loans to most independent car dealerships.

The bank may have struggled to finance these offerings ever since the Federal Reserve placed penalties and growth limits due to its fake accounts scandal, which affected millions of its customers’ checking and savings accounts.

Clients were given a 60-day warning of the “inconvenient” credit line closures. The bank added that it would work with them to find an eventual credit solution.

Concerned that this could affect your credit score? You can consider using a credit monitoring service, which can provide instant alerts on credit score changes, late payments, and fraudulent activities.

Source: FOX Business