Initially, JPMorgan Chase announced that they were increasing their lending standards for home mortgage borrowers. The new threshold would require at least a 20% down payment and a FICO score of minimum 700. This might appear to be severe but the average FICO score in America is 695.
Now JPMorgan Chase is no longer accepting new HELOC applications. No exceptions. Customers who are current HELOC borrowers will continue to be able to access their accounts with the full line of credit, but the bank will no longer be accepting new HELOC applications.
The bank issued the statement that due to economic uncertainty, primarily due to the COVID-19 pandemic, they were temporarily pausing new HELOC applications. There appears to be more behind this decision than just economic uncertainty. A great deal has to do with the low margin of profit on a HELOC currently right now. Average HELOC rate is 4.91% but it does have a range of between 3.5% and 8.6%.
Chase has already shifted some of its HELOC staff to work with customers requesting regular mortgages.