JP Morgan is preparing massive layoffs in its mortgage division due to the housing crisis in the US.

The Fed’s base rate hike has pushed mortgage rates to 6% so far this year, which has already taken its toll on JP Morgan.

Photo: MICHEL EULER/Getty Images

Due to the slowdown in the housing market caused by rising mortgage rates and inflation, JP Morgan Chase is cutting jobs in its home loan division.

According to a report published by Bloomberg, the bank is expected to lay off or reassign more than 1,000 employees. He noted that “about half” of these affected workers will be moved to different departments within the bank.

“Our personnel decision this week was the result of cyclical changes in the mortgage marketa JPMorgan spokesperson said in a statement.

“We were able to proactively move many affected employees into new roles within the company and are working to help the remaining affected employees find new employment within Chase and externally.”

The decision comes after last week the Federal Reserve raised your benchmark interest rate by 75 basis pointsthe largest increase in nearly three decades.

So far this year, the increase in borrowing costs by the US central bank. has driven mortgage rates to almost 6%.

Just at the beginning of June, the CEO of JP Morgan Chase, Jamie Dimon, assured that the possible scenario that the economy in the United States plunges into a recession looks like become an “economic hurricane”.

With its recent move, JP Morgan joins a growing list of real estate companies reducing their workforce to cut costs as higher interest rates put pressure on demand.

Also the online real estate platform Redfin announced that would lay off 8% of its workforceand CEO Glenn Kelman cited a slowdown in home sales and a sharp rise in mortgage rates.

Real estate company Compass also said it was reducing its workforce as companies grapple with a cooling market due to last year’s pandemic-driven surge in home sales.

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