JPMorgan Chase (JPM) is selling off a chunk of its mortgage servicing operation to a Dallas company that specializes in servicing distressed debt.
Wingspan Portfolio Advisors announced Tuesday that it is acquiring JPMorgan Chase's servicing operation in Melbourne, Fla. As part of the agreement, Wingspan will offer positions to 400 JPMorgan Chase employees and acquire the lease of the Melbourne office building.
A sale price was not disclosed.
Jason Spooner, Wingspan's executive vice president of servicing, will oversee the Florida office, which would be Wingspan's first outside of the Dallas area. Once the deal is completed, Wingspan would have nearly 2,000 employees in four locations.
Steven Horne, Wingspan's chief executive, said the purchase was indicative of servicers downsizing their default servicing operations and outsourcing the servicing of distressed residential loans to special servicers. Spooner is a former senior vice president of default at SunTrust Banks.
For JPMorgan Chase, the sale is consistent with its plan to reduce its overhead. On Tuesday, JPMorgan Chase said it would cut 13,000 to 15,000 employees in its mortgage operations, primarily in default servicing, by 2014.