BEACHWOOD, Ohio - Two Bank of America mortgage operations centers in Cuyahoga County will close at the end of October.
NewsChannel5 learned on Thursday that the centers in Beachwood and Independence, which employ more than 1,000 people, will be closing on Oct. 31.
"We were contacted today by Bank of America representatives. They indicated that with the increase in interest rates, their home loan and refinancing applications are down substantially, and that as a result, there were pending layoffs in multiple cities and states housing this line of business, including ours," Beachwood Mayor Merle S. Gorden said in a statement on Thursday.
A total of 1,200 Bank of America employees in the state of Ohio are affected by the cutbacks. That includes 660 mortgage operation and 340 call center workers in Beachwood, and 55 mortgage center employees in Independence.
The human resources department is working with the Beachwood and Independence employees to place them at other locations within Bank of America and other employers.
Gorden said the Cleveland Clinic owns the two buildings that house the Bank of America facilities affected in Beachwood. He said he hopes the Cleveland Clinic could expand into that space, creating new jobs.
Bank of America released the following statement Thursday afternoon:
"We continue to reduce the size of our mortgage servicing operations in line with the successful reduction of our portfolio of delinquent mortgage customers. Compared to peak levels in 2011, today we have fewer than one-third the numbers of customers who need the specialized programs and support of this team. These actions also reflect our ongoing efforts to streamline our facilities and align our cost structure with market realities, including declining refinance volume resulting from rising interest rates.
Bank of America has a strong track record for helping our employees identify opportunities both inside and outside of the bank and we are working closely with leaders in the community to support a smooth transition. We remain committed to Ohio and continue to refine our business model to account for changes in the marketplace to both preserve our presence and plan for the future."