Wells Fargo (WFC) faces a HUD Fair Housing Act investigation over its Black homeownership programs, October 2026
HUD is investigating whether Wells Fargo's $60 billion lending pledge and its 2022 special purpose credit program sorted borrowers by race. The stock was already down 2.3% when the report crossed and rose 0.53% in the next ten minutes.
- HUD said on October 7, 2026 that it had opened a Fair Housing Act investigation into Wells Fargo's programs to increase Black homeownership, the same day the Wall Street Journal reported it.
- The programs include a 2017 pledge of $60 billion in lending by 2027 and a 2022 effort of $210 million, of which $150 million cut mortgage rates and refinancing costs through a special purpose credit program.
- Wells Fargo was at $79.60, already 2.3% below the previous close, when the report reached the MoveSurge news feed at 11:41:23 ET; it rose 0.53% over the next ten minutes and closed down 1.53% at $80.26.
11:41:23 ET
Reaction by asset (real prices)
| Asset | 2m before | At release | +1m | +10m | +1m % | +10m % |
|---|---|---|---|---|---|---|
| WFC Volume 7.1× normal in 15 min |
79.60 | 79.60 | 79.71 | 80.02 | +0.14% | +0.53% |
The US Department of Housing and Urban Development has opened a Fair Housing Act investigation into Wells Fargo (NYSE: WFC) over programs the bank ran to increase Black homeownership, HUD said on Wednesday, October 7, 2026, the same day the Wall Street Journal reported the probe. The report reached the MoveSurge news feed at 11:41:23 ET with Wells Fargo at $79.60, already 2.3% below the previous close of $81.51, and over the next ten minutes the stock rose 0.53% to about $80.02. It had opened 1.3% lower at $80.48 and closed at $80.26, down 1.53%, so most of the day's decline was already in the price when the report crossed.
What HUD is investigating
HUD's Office of Fair Housing and Equal Opportunity sent a letter to chief executive Charlie Scharf, signed by Assistant Secretary Craig Trainor, under Section 805 of the Fair Housing Act, the section that covers discrimination in residential real estate lending. HUD alleges that the bank sorted homeowners by race and offered them different products or terms. Trainor said that calling a program a special purpose credit program does not take it outside the Act. Wells Fargo has been told to preserve its records, including emails and texts on personal devices, and to expect information requests within 10 business days of the letter. The investigation could end in an administrative complaint or a referral to the Justice Department. HUD said it is reviewing similar programs at other banks, which it did not name, and Wells Fargo declined to comment.
The programs under review
| Year | Program | Size | Reported result |
|---|---|---|---|
| 2017 | Lending pledge to add 250,000 Black homeowners by 2027 | $60 billion | About 40% reached by 2023, according to HUD |
| 2022 | Racial-equity housing effort | $210 million | Included $150 million to cut mortgage rates and refinancing costs through a special purpose credit program; about 5,100 customers refinanced, saving about $100 a month |
A special purpose credit program is a lending program that the Equal Credit Opportunity Act lets a lender design for an economically disadvantaged group. Since July 21, 2026, a rule from the Consumer Financial Protection Bureau has barred for-profit lenders from using race, color, national origin or sex as eligibility criteria for such programs. Wells Fargo said in August that it had ended its program before federal agencies withdrew their 2022 guidance on August 25. The investigation therefore concerns how the programs worked while they ran. According to Trainor, the bank removed references to diversity, equity and inclusion from its website in 2025.
How federal policy on these programs changed
- March 25, 2025: FHFA Director Bill Pulte ordered Fannie Mae and Freddie Mac to end their special purpose credit programs.
- March 24, 2026: HUD opened a Fair Housing Act investigation into Washington State's Covenant Homeownership Program.
- April 22, 2026: the CFPB published its Regulation B rule barring race, color, national origin and sex as eligibility criteria in for-profit programs; it took effect on July 21.
- August 25, 2026: seven agencies, among them HUD, the CFPB, the Justice Department and FHFA, rescinded their 2022 joint statement on special purpose credit programs.
- October 7, 2026: HUD's letter to Wells Fargo.
Wells Fargo reports third-quarter results on Tuesday, October 13, at about 7:00 a.m. ET.
Why is HUD investigating Wells Fargo?
HUD says Wells Fargo's programs to increase Black homeownership, including a $60 billion lending pledge from 2017 and a 2022 special purpose credit program, may have sorted borrowers by race in violation of Section 805 of the Fair Housing Act. HUD opened the investigation on October 7, 2026.
How did Wells Fargo stock react to the HUD investigation?
When the report crossed at 11:41:23 ET on October 7, 2026, Wells Fargo was at $79.60, already 2.3% below the previous close. It rose 0.53% over the next ten minutes and closed at $80.26, down 1.53%.
What is a special purpose credit program?
It is a lending program that the Equal Credit Opportunity Act allows a lender to design for an economically disadvantaged group. Since July 21, 2026, for-profit lenders may not use race, color, national origin or sex as eligibility criteria.
When does Wells Fargo report third-quarter 2026 earnings?
On Tuesday, October 13, 2026, at about 7:00 a.m. ET.
Sources
-
ICYMI: Wells Fargo Faces Regulator Probe Over Efforts to Boost Black Homeownership (HUD No. 26-081)
— US Department of Housing and Urban Development
HUD's investigation of Wells Fargo under the Fair Housing Act, the officials involved, the $60 billion pledge and its progress by 2023, and the refinancing results.
-
Wells Fargo faces regulator probe over efforts to boost Black homeownership, WSJ reports
— Reuters via KFGO
The Wall Street Journal report of the probe; Wells Fargo declined to comment.
-
HUD investigates Wells Fargo over race-based mortgage efforts
— HousingWire
Section 805 legal theory, the letter signed by Craig Trainor, records preservation, information requests within 10 business days, and the $210 million 2022 effort including $150 million through a special purpose credit program.
-
Wells Fargo stock falls on federal lending probe report
— Investing.com
Wells Fargo shares fell after the report; HUD is reviewing similar programs at other banks.
-
HUD launches investigation into Wells Fargo's lending programs
— Bisnow via Yahoo
Trainor's letter and his statement that the bank removed DEI references from its website in 2025.
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