JPMorgan Chase & Co. is eliminating its non-agency products for mortgage brokers.
Chase Wholesale issued a bulletin today indicating it is suspending it non-agency products within the wholesale lending business. The move impacts both fixed-rate and adjustable-rate mortgage programs.
Impacted product features include the super jumbo feature; non-agency premier program; non-agency Chase signature series streamline purchase, no cashout and cashout refinances currently available on market types 623, 603, 510, 516, 517, and 513; and non-agency LPMI currently available on market type 603.
Any remaining non-agency loans must be registered by Aug. 3 and delivered to underwriting by Aug. 31. The last day to close and fund non-agency loans is Sept. 15.
No lock extensions, renegotiations or extension of credit document expiration dates will be granted, the bulletin said.
Chase attributed the decision to a dramatic decline in jumbo volume during the past six months, a lack of demand in the capital markets for jumbo products and worse-than-expected delinquency on bigger loans.
Chase spokeswoman Christine Holevas told MortgageDaily.com that no layoffs are currently planned but added, "I'll be honest with you ... it's fluid."
Offsetting the elimination of nonconforming programs is the temporary increase to conforming and government loan limits up to $729,750 under H.R. 5140, the Economic Stimulus Act of 2008, which ends on Dec. 31. In addition, H.R. 3221, The Housing and Economic Recovery Act of 2008, which was signed by President Bush on Wednesday, permanently raises both caps to $625,000.
Chase, which noted in the bulletin that it is still committed to its wholesale business, cut correspondent limited documentation programs in June, halted wholesale subprime and home-equity programs in May and eliminated Alt-A wholesale programs in January.