Wells Fargo to Offload Billions in Commercial Mortgages to Trimont
Wells Fargo has announced plans to divest the majority of its commercial mortgage servicing business, transferring it to global loan servicing firm Trimont, according to a statement released Tuesday. This move will position Trimont as the largest loan servicer in the U.S., based on rankings from the Mortgage Bankers Association.
The transaction, which is expected to close in early 2025 pending regulatory approval, involves the sale of Wells Fargo’s non-agency third-party Commercial Mortgage Servicing business. Once completed, Trimont will oversee more than $715 billion in U.S. and international commercial real estate loans.
Trimont, established in 1988, specializes in managing and servicing commercial real estate loans, helping lenders navigate the complex landscape of commercial real estate financing. The deal is considered a strategic shift for Wells Fargo, reflecting the ongoing pressures faced by the banking sector amid high interest rates and a challenging commercial real estate market.
The U.S. commercial real estate sector has struggled with declining valuations and increased office vacancy rates since 2021, exacerbated by the COVID-19 pandemic. Analysts foresee continued difficulties for lenders and property owners as market conditions evolve.
In line with its new strategy, Wells Fargo has previously indicated a shift in focus towards serving its existing customers and minority homebuyers, while scaling back its mortgage servicing and correspondent business. This decision is part of a broader effort to streamline its operations following a series of scandals and regulatory actions that have impacted the bank’s reputation and financial stability.
The sale marks a significant transition for Wells Fargo, which has historically been a major player in the mortgage industry but has faced scrutiny over past misconduct, including a major fake accounts scandal that resulted in hefty fines and leadership changes.
