With the mortgage boom officially over, banks are closing facilities and units that have been servicing customers looking to refinance their home loans. JPMorgan laid off more than 2,000 employees in early August—about half of them in originations, according to a person familiar with the situation. The bank had said in February that it would cut 17,000 jobs (largely in the mortgage servicing unit, which handles bad loans) by the end of 2014. The August round of layoffs represented the first time the bank had moved to downsize its origination business, which surged as mortgage rates went to historic lows. Other Wall Street banks are making similar moves, as a sharp rise in rates has kept consumers from taking out or refinancing mortgages.
Late last month, Bank of America notified 2,100 employees that their jobs were being cut; Wells Fargo has laid off more than 3,000 since July. Citigroup confirmed Wednesday the July closure of an office in Danville, Ill., that affected 120 jobs. “The Danville facility was originally established to handle the surge in demand for refinancing,” said Citi spokesman Mark Rodgers, who added that other telephone sales positions supporting mortgage banking would be cut.
To read the full article, click here.
Source: CNBC