Wells Fargo, the mortgage lender, is eliminating about 1,800 more jobs in its home-loan production business as rising mortgage rates curtail borrowers’ demand for refinancing.
Bloomberg reports that the reductions are in addition to 3,000 earlier this quarter.
Wells Fargo is cutting jobs as higher borrowing costs slow refinancings and new home purchases fail to compensate for the decline. The bank may originate about $80bn in home loans in the third quarter, a 29% drop from the three months that ended 30th June, Chief Financial Officer Timothy Sloan said 9th September.
Wells Fargo was the biggest employer among U.S. banks at midyear with about 274,000 people. The workers whose positions are being cut received 60 days’ notice, Goyda said.
Mortgages typically are divided into those for refinancing existing loans and those for home purchases. While refis are mainly tied to the level of interest rates, purchase mortgages are tied to home-sale activity.
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