When regulators seized First Republic Bank, and JPMorgan Chase bought most of its operations, the megabank assumed responsibility for $91 billion in customer deposits along with $173 billion in loans. Much of that is jumbo mortgages on expensive homes bought by First Republic’s clients. 

At a former First Republic branch in Portland, Oregon on the day of the acquisition, depositors could access their money just like usual — only now as customers of JPMorgan.

But for borrowers with mortgages from First Republic, “It’s probably not as seamless as that,” said Guy Cecala at Inside Mortgage Finance.

He said JPMorgan has a lot of paperwork to do, including notifying borrowers that the bank will be servicing their mortgages and receiving their monthly payments.

“Frankly, there are always hiccups — somebody forgets, or they have automatic payment — so, it’s not as clean as just going into the bank and saying, ‘great, my deposits are still here,” Cecala said.

Mortgages are contracts, so JPMorgan can’t arbitrarily hike the interest on a fixed-rate loan, for instance. 

Many of the jumbo home loans are well-underwritten with big down payments, so Cecala says they aren’t particularly risky.

But, as Mike Mayo at Wells Fargo Securities said, it’s not the mortgages that JPMorgan really wants.

“The acquisition is really about the customers that they’re getting — for wealth management and other needs,” he said.

The FDIC says that for now, anyone with a First Republic loan should keep sending their payments in as usual until notified otherwise.