Mortgage lenders including Wells Fargo & Co. (WFC) and JPMorgan Chase & Co. (JPM) that feasted on refinancings as interest rates reached all-time lows are now warning that the drop in demand may be steeper than expected.
Even Bank of America Corp., which fell to fourth in U.S. mortgages last year as it scaled back after buying Countrywide Financial Corp., is reducing capacity further as surging interest rates crimp demand. The Charlotte, North Carolina-based firm is eliminating 2,100 jobs and closing 16 offices by Oct. 31, said two people with direct knowledge of the plan.
Home lenders are tempering forecasts after interest rates rose amid signs the Federal Reserve may scale back stimulus efforts. Wells Fargo, the top U.S. home lender, said yesterday that third-quarter originations may fall 29 percent to $80 billion. JPMorgan, ranked No. 2, said it expects to lose money on home lending in the second half as volumes drop as much 40 percent from the year’s first six months.
Notary signing agents may see a long dry spell as interest rates continue to rise as the economy grows stronger. Some notaries will move to field service inspections while some with do nothing.
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