JPMorgan announces 8,000 job cuts, housing sees good and bad news, and a criminal mastermind slugs a prosecutor in open court. MPA takes a look at the news that affects our industry.
Video transcript below:
Happy Friday everyone, I'm Ryan Smith and this is MPA's weekend review.
The nation's largest bank will cut thousands of jobs in its mortgage unit this year as it tries to shrink operating costs in the face of lower Refi volume. JP Morgan Chase announced plans to cut 8,000 jobs by the end of 2014, mostly in its mortgage and retail banking units. That follows about 16,500 cuts in those units last year. News of cuts to mortgage jobs is becoming increasingly common, hundreds of job cuts have been announced in the last few weeks by companies like Bank of America, Nation Star and PHH and thousands of mortgage employees have been handed their walking papers over the last 12 months.
Well there’s a bit of a win-lose on home sales front with new home sales spiking last month while existing home sales plummeted. Total existing-home sales sank 5.1 percent in January to a seasonally adjusted annual rate up 4.62 million. Last month saw the lowest level of activity since July 2012 according to the National Association of Realtors. New home sales meanwhile hit five-and-a-half year high in January blowing past economists projections. New home sales spiked 9.6 percent last month to a seasonally adjusted annual rate of 468,000, the highest level since 2008.
So if you're arrested after being on the lam for nine months to avoid a 13-year sentence for mortgage fraud, what's the very last thing you want to do. If you answered assault a federal prosecutor, you're smarter than Ronnie Duke, the 46-year-old Michigan resident who fled in June to avoid a prison sentence for orchestrating one of the largest mortgage scams in the nation was arrested Monday and allegedly lunged at the prosecutor during his arraignment. Duke created false title companies, collaborated with appraisers on the $95 million fraud and hired former strippers as loan processors. Prosecutors say Duke masterminded the scheme making it the first time the word mastermind has been used to describe this guy.
Fixed rates climbed again this week for the fourth consecutive week, while adjustable rates eased somewhat. The average rate for the 30 year fixed rate mortgage rose to 4.37% this week, up from last week's 4.33%. The 5-year adjustable-rate mortgage (ARM) fell to 3.05% from last week's rate of 3.08% and the 1-year ARM fell to 2.52% from last week's 2.57%.
For MPA Mortgage News, I’m Ryan Smith, have a great weekend.