JP Morgan To Stop Using Outside Mortgage Brokers
Source: http://feeds.feedburner.com/~r/StocksOptionsBlog/~3/511909188/Posted on Wednesday, January 14th, 2009 | In Stocks to Watch
Wednesday January 14, 2009
Navivest
JP Morgan Chase & Co (JPM) today announced that it will stop underwriting prime mortgages that are originated through third-party brokers and will instead start relying on its branch network to make home loans directly to creditworthy customers, this according to the Wall Street Journal.
Having acquired Washington Mutual, JP Morgan now has the retail footprint to be able to embark on this strategy.
While third-party brokers do provide a very cost effective way for a mortgage lender to expand, if more top tier banks adopt an in-house strategy, which is very possible in this environment, it could be very disastrous for the mortgage brokerage industry, which is already hard hit from the downturn in the housing market.
Then again, part of the reason for the sub-prime mess was mortgage brokers getting creative with mortgage applications, by encouraging their clients to lie on applications.
Tags: JP Morgan Mortgage Brokers
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JP Morgan Chase, JP-Morgan, mortgage applications, retail footprint;, Stocks to Watch, The Wall Street Journal, Wall Street Journal, Washington Mutual
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