In recent weeks, heads of JPMorgan Chase, Wells Fargo and Bank of America made statements calling for more lax regulations pertaining to loan origination, servicing and securitization.

JPMorgan Chase's CEO Jamie Dimon noted that "reducing unnecessary regulations would decrease homeownership costs" and positively "impact the availability of credit and who can qualify for a mortgage,"in his annual shareholder letter published April 7.

"Streamlining loan origination and servicing standards, reducing capital requirements and simplifying securitization rules would reduce the cost of mortgages without making them riskier, " he posited. "These simple reforms could lower the cost of mortgages by 70–80 basis points."

Meanwhile, both Bank of America's CEO Brian Moynihan and Wells Fargo's CEO Charles Scharf echoed that deregulation could boost loan origination, as reported by Yahoo Finance.

Dimon also emphasized the importance of "good and consistent local zoning requirements" as essential to building more affordable housing.

The Trump administration has expressed interest in pursuing this approach in the near future. Housing and Urban Development's Secretary Scott Turner said the agency plans to eliminate "20% to 25% of single-family home-related regulations," calling them "bureaucratic red tape," including environmental regulations and land-use restrictions.

Depositories, once big players in the mortgage origination space, ceded their market share following measures taken against them by the Department of Justice and HUD after the Great Recession.

Bank of America, JPMorgan Chase, SunTrust and Wells Fargo were among a handful of banks penalized for violating the False Claims Act, having to pay more than $4 billion to the government. 

These measures, alongside market volatility concerns, caused many depositories to rethink their participation in the lending business, resulting in an exodus from FHA lending. 

A tally from 2021 shows that the share of banks participating in mortgage lending dropped from 76% in 2010 to 37% in 2021. 

If the government does do away with some of the risk associated with lending for banks, might that signal that depositories will rush back into mortgage? Time will tell, but the likelihood of that is too early to predict.

One industry stakeholder said banks are already overleveraged and have enough on their plates, adding they are also likely to be partially affected by tariffs imposed on other countries.

"Anything that tariffs touch, touches banks too," they said.