In a letter to shareholders, JPMorgan Chase CEO Jamie Dimon included a section titled, “Why are you still in the mortgage business?,” writing that there are “increasingly lower returns” coming from mortgages, reports HousingWire staffer Ben Lane.
“The mortgage business can be volatile and has experienced increasingly lower returns as new regulations add both sizable costs and higher capital requirements,” Dimon writes.
“In addition, it is not just the cost of the new rules in origination and servicing, it is the enormous complexity of those new requirements that can lead to problems and errors,” Dimon continues. “It is now virtually impossible not to make some mistakes – and as you know, the price for making an error is very high.”
According to Dimon, JPMorgan Chase is staying in the mortgage business for its customers. “Mortgages are important to our customers. For most of our customers, their home is the single largest purchase they will make in their lifetime,” Dimon writes.
“More than that, it is an emotional purchase – it is where they are getting their start, raising a family or maybe spending their retirement years,” Dimon continues. “As a bank that wants to build lifelong relationships with its customers, we want to be there for them at life’s most critical junctures.”