JP Morgan Chase decided to take on a loan portfolio from Citi to help with the goal of expanding lending portfolios. The deal is worth about $ 3.5 billion, and is a part of the $ 8 billion in troubled loans Citi has been selling to others. The purchased loans are practically guaranteed pay day loan for JP Morgan Chase, as they are loans for apartment and multi-family buildings.
Faxless loan portfolio being sold off by Citi
Citi is trying to sell a ton of its loans and securities as part of a rebuilding strategy. Citi Holdings group has been able to receive most of this although other companies willing to get in have bought $ 19 billion worth of loans and securities. Citi is trying to make its business smaller when selling securities at as high of a price as possible.
JP Morgan Chase got some credit loans
The portfolio that JP Morgan Chase has purchased from Citi contains about 3,800 multi-family dwelling loans. With this purchase and others, JP Morgan Chase has become the third-largest mortgage lender behind Fannie Mae and Freddie Mac. JP Morgan Chase already had “in the pipeline” $ 300 million in multi-family loans.
Mortgage lending going up
Mortgage applications are going up although it has been very slow. There was a .6 percent increase in applications for new home loans last week. Individuals are in need of more loans but are avoiding applying for them still. Though legislators are putting pressure on banks to increase their lending, banks are fighting back. Banks really only want to give loans to applicants who are “credit worthy”. ”Credit worthy” people are hard to find now and days with anything going on within the economy. Larger banks have had things shifted around with this huge multi-family loan purchase from JP Morgan Chase, and nobody knows if it will help increase lending in banks or not.
