JPMorgan Chase & Co., which has recently been expanding its payroll, is eliminating hundreds of positions in its real estate finance business. Improving mortgage performance is behind the layoffs.
In its second-quarter earnings report, the New York-based financial services giant reported 30-day delinquency on its residential loans, excluding purchased credit impaired mortgages, at only 0.86 percent.
Mortgage delinquency has plunged since the foreclosure crisis, with the 30-day rate previously having been reported at 7.73 percent as of the end of 2009. The improvement in performance has been consistent and ongoing.
But with more borrowers paying on time, the need for staffing to handle distressed customers has been greatly diminished.
So Chase
is laying off approximately 400 mortgage employees, a spokeswoman confirmed to Mortgage Daily Friday. Cities where impacted employees are located include Cleveland; Columbus, Ohio; Jacksonville, Florida; and Phoenix.
The spokeswoman noted that the reduction accounts for less than 3 percent of its home-lending employees.
“Our servicing portfolio is performing well, with delinquencies accounting for less than two percent of all loans — a 22 percent decline from last year,” the statement said. “When fewer people are struggling with their mortgages, and more people are using self-service channels, we can adjust staffing.
“Like all companies, we are making improvements to operate more efficiently and make slight adjustments to resources to best meet the needs of the market.”
Chase notified
the Texas Workforce Commission on Tuesday that it plans to layoff 107 San Antonio, Texas, employees on Dec. 1, though it’s not clear if these layoffs are among the 400 disclosed today.
The job cuts follow
recent announcements from Chase that mortgage positions would be included among more than 3,000 employees to be hired in new markets over the next few years. Those hirings include 300 in the Philadelphia-Delaware Valley region and 700 in the Maryland-Washington, D.C.-Virginia market.
Wells Fargo & Co., which earlier this year revealed plans to layoff more than a thousand mortgage employees, said last month that it would reduce its company-wide staff of 264,500 by as much as 10 percent over the next three years.
While large banks are often ahead of the layoffs when mortgage lending slows,
mid-level mortgage lender Movement Mortgage LLC said Thursday it planned to eliminate 180 positions — bringing its year-to-date layoffs to more than 300.
The Wall Street Journal first reported the Chase layoffs Friday morning.
