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Sun American Mortgage - Reverse Mortgage Lender

Sun American Mortgage is a lender, seller and servicer of the government insured Reverse Mortgage. Over twenty years ago, we closed the first ...

Mortgage crisis returns to bite Wells

Nearly a decade after the financial crisis, Wells Fargo is getting stung by bad behavior in the housing bubble.

Wells Fargo took a surprise $1 billion charge in the quarter for previously disclosed pre-crisis, mortgage-related regulatory investigations, the third-largest U.S. lender said Friday . The expense pushed total costs to a record $14.4 billion.

This latest hit adds to Chief Executive Officer Tim Sloan’s challenges, 13 months after the San Francisco-based lender was rocked by a fake-accounts scandal. Wells Fargo has struggled to attract customers after news broke last year that branch bankers opened thousands of accounts without customer approval to meet aggressive sales targets. More recently, it’s come under fire over auto-loan clients who were forced to pay for unwanted car insurance and homeowners who were improperly charged fees for mortgages.

The legal charge related to pre-crisis mortgages cut 20 cents from the bank’s earnings per share. Net income fell 19% from the year earlier period to $4.6 billion. Analysts had expected $5.13 billion. Earnings per share of 84 cents fell short of the $1.03 average estimate of 26 analysts surveyed by Bloomberg.

B of A's revenue barely rises, but cost cuts come to the rescue

Brian Moynihan’s efforts to boost Bank of America profit through cost-cutting finally got some help from interest rates.

The lender posted its highest net income in six years as the chief executive officer cut expenses more than forecast and net interest income rose to the highest since 2011.

Moynihan and his executives have promised for years that the bank will boost revenue from lending whenever interest rates rise. And on that front, the lender — viewed by investors as the U.S. bank most affected by rate changes — just barely beat expectations.

Net interest income, which makes up about half of the Charlotte, North Carolina-based firm’s revenue, rose 1.6% from the previous quarter as the Federal Reserve has raised interest rates three times since December.

During his seven years as CEO, Moynihan has worked to reduce legal costs that dogged the firm after it acquired Merrill Lynch and troubled mortgage lender Countrywide Financial. The lender has spent $70 billion on legal bills since the financial crisis — more than any other U.S. bank — including $30 billion on mortgage putbacks.