JPMorgan Chase is laying off about 400 employees in its consumer mortgage banking division as rising mortgage rates contribute to a slowdown in the industry, a company spokesperson confirmed on Friday.
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The job cuts will occur primarily in Cleveland, Columbus, Ohio, Phoenix and Jacksonville, Florida, the Wall Street Journal reported, citing sources familiar with the matter. Rising interest rates have de-incentivized mortgage refinancing deals, while rising mortgage rates have impacted overall home sales.
Company representatives confirmed the cuts and said the layoffs were enacted “to best meet the needs of the market.” JPMorgan Chase has roughly 34,000 employees in its mortgage banking sector.
“Our servicing portfolio is performing well, with delinquencies accounting for less than two percent of all loans – a 22% decline from last year,” the company said in a statement addressing the cuts. “When fewer people are struggling with their mortgages, and more people are using self-service channels, we can adjust staffing.”
The bank’s cuts came just two months after Wells Fargo cut more than 600 jobs in its mortgage business, roughly a third of which were based in California. Those layoffs came “after carefully evaluating marketing conditions and consumer needs,” a Wells Fargo spokesperson said at the time.