Bank of America announced last week it had laid off around 100 employees from a “legacy asset servicing division,” Dan Frahm, a bank spokesman, told the Charlotte Business Journal.
“We’ve made significant progress in assisting mortgage customers, having helped more than two million homeowners avoid foreclosure,” Frahm said. “The number of customers who need these specialized services has dropped dramatically — it has declined 92% from the peak level.”
The bank announced during its quarterly earnings conference call earlier this month that it had reduced employee headcount by 1,500 during Q3.
And the Bank of America isn’t the only big bank to make cuts to its mortgage division.
Wells Fargo axed 500 positions nationwide in October.
Those layoffs won’t result in an influx in players to the mortgage broker channel, however, according to one industry professional.
“Those people aren’t licensed and that is the biggest problem with the banks,” Greg Machnacki, an originator with Mortgage One in Michigan, told Mortgage Professional America. “They’re not eligible; they’d have to take the test.”
It’s good news, then, that at least one of the banks is encouraging those laid off employees to look for alternative employment within its ranks.
“We have a strong track record for helping employees transition into new positions within the company,” Frahm said. “For those impacted and not able to find a new role at the company, we work closely with them and provide career counseling, services and resources to assist with finding a new role.”
Two big banks announced major layoffs in their respective mortgage divisions this month.