The 5 C’s of credit every first-time homebuyer should know

A first-time homebuyer can easily get lost in the weeds when applying for a home loan, which is why we recommend starting with the basics: the five C’s of credit.

“Wait a second,” you might be asking yourself. “The what?”

The five C’s of credit are character, capacity, capital, collateral and conditions. Lenders may use all or some of these characteristics to determine your creditworthiness before approving a loan.

Learning these five characteristics can help prepare you for one of the biggest investments you’ll ever make. How? Because looking at them side-by-side can help you fill in the blanks on everything from your credit history to how big a down payment you’ll need to get the mortgage you want.

Let’s check out the five C’s of credit and see how they can help make you a smarter first-time homebuyer.


The 5 C’s of credit

  1. Character
  2. Capacity
  3. Capital
  4. Collateral
  5. Conditions

Character

In the days of Model T’s and ice-cream socials, it was easier for everyone in a community to know who was — and who wasn’t — a high-risk customer for a loan. Basically, it was easier to know who had character.

Today, “character is often measured by your credit,” says Benjamin Keys, assistant professor of real estate at the Wharton School of the University of Pennsylvania. “And credit scores are a key metric.”

Your credit reports contain information about your credit accounts and transactions. A lender can look at your credit reports to learn how often you make payments on time and how many accounts (credit cards, auto loans, student loans, etc.) you have in good standing.

A credit score is a three-digit number that reflects the information in the corresponding credit report. Knowing what goes into your credit scores and reports can be the first step to improving them so that you can make a good impression on potential lenders.

Keep in mind that there are multiple providers, each of which may use different scoring models to generate scores. That means that your scores might differ depending on the model and provider. Also, during the underwriting process a mortgage lender will probably use a different scoring model than the ones available on Credit Karma.

What’s in a credit score?

Action steps:

  • Check your credit reports and verify that all the information is accurate and current. Credit Karma offers free credit reports from two of the major consumer credit bureaus, TransUnion and Equifax. You may also be able to dispute any errors you find on your TransUnion® credit report through Credit Karma’s Direct Dispute™ tool. You’ll have to file a dispute with Equifax directly if you see an error on your Equifax® credit report. Don’t forget that your lender may use a different report than the ones available on Credit Karma, but you should still check for errors to get a baseline idea of what sort of problems might be lurking on other reports.
  • Check your credit scores. On Credit Karma, you can get your free VantageScore 3.0 credit scores from TransUnion and Equifax. Remember, your lender may use a different score than the ones available on Credit Karma. Nonetheless, checking your scores on Credit Karma can help you get a directionally accurate view of your credit.
  • Find out how lenders might categorize your scores. Some lenders group scores into ranges, explains Keys. If your scores are within sneezing distance of a higher (read: less expensive) mortgage rate category, it could pay to wait and work on improving your credit health, says Keys. In the eyes of lenders, better credit could mean that you’re less likely to default on a loan. Being seen as less risky could result in a more favorable interest rate.

Capacity

Your capacity is based on your financial ability to repay the mortgage.

“Capacity is usually measured by income and employment,” says Keys.

Lenders may review your most recent federal tax return, along with several pay stubs and a few months of bank statements, to verify your income.

The other factor they’ll likely assess in relation to your income and employment is your stability. Part of that relates to how long you’ve had your job, says Barry Zigas, director of housing policy for the Consumer Federation of America.

That bit of information may seem a bit irrelevant, but most lenders want to see proof that your income is stable and consistent.

Lenders may also look at your debt to income ratio (also known as your DTI ratio). This metric helps them evaluate how much additional debt you can handle and how much of a credit risk you pose. Though your DTI ratio isn’t one of the key factors used to calculate your credit scores, it can still have a significant impact on your ability to get credit.

To figure out your DTI ratio, first add up all your monthly debt obligations. (These may include your monthly credit card payments, loan repayments and other financial obligations, such as alimony.) Then divide the sum by your monthly pretax income.

FAST FACTS

The ideal DTI ratio for getting a mortgage

There’s no “magic number” when it comes to the ideal DTI ratio for first-time homebuyers. The preferred range varies by lender, but there are some general limits you’ll want to note. The Consumer Financial Protection Bureau recommends a DTI no higher than 43% to get a qualified mortgage. And in May 2017, Fannie Mae recently raised its maximum DTI for borrowers to 50% from 45%. Keep in mind, though — that’s the max. We recommend trying to keep your DTI ratio below 43% to stay on the safe side.

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Action steps

  • If your DTI ratio is higher than you’d like, try to lower it. The two ways to do so are to pay off your debt or increase your income. Consider asking for a raise, refinancing your loans or even taking on a side hustle if you have the time.
  • Build a healthy savings account. A large amount of money or liquid assets can compensate for a less attractive DTI, says Zigas.
  • Limit your search to homes that fit your circumstances and abilities, rather than the maximum amount you can afford to pay.
  • Before you commit to a house, calculate the specific expenses associated with it. This may include everything from repairs and upkeep to property taxes, utilities and insurance, says Zigas.

Capital

Capital is the money you have left after you buy a home, along with any investments, properties and other assets you could liquidate fairly quickly.

Why it’s important: Even though a home is likely the largest purchase you’ll ever make, lenders generally don’t want you to clean out your bank accounts to buy a home.

“If you don’t have cash in the bank after you’ve bought a house, you could be vulnerable,” explains Zigas. Even if it’s not required by your lender, a cash cushion can act as a shock absorber for everything from home repairs to a job loss.

Oftentimes, mortgage lenders will frame your savings in terms of a certain number of mortgage payments you have in the bank, says Keys. But the specific number they like to see varies.

Action steps

  • Recognize that a down payment is only part of buying a home. It’s smart to save as much money as you can so you can comfortably make future mortgage payments and cope with the regular costs of homeownership, like repairs and taxes.
  • Ask about the expected cash reserve. When you interview potential mortgage lenders, ask each how much money in your bank accounts they want to see.

Collateral

Collateral is something of value that secures a loan. When you get a mortgage, the collateral is typically the home itself.

“The collateral is basically what the lender is depending on in the event the borrower can’t repay the loan,” says Zigas.

One reason lenders usually require a home appraisal (and sometimes an inspection) is that they want to be sure that the house’s value “supports the mortgage,” he adds.

Action step

  • Shop collateral requirements when you compare mortgage terms. “The myth that a lot of homeowners believe is that they have to put 20%” down, says Keys. But the Federal Housing Administration, Fannie Mae and Freddie Mac have home loan programs for borrowers who want to put down less than 4%. But note that there are requirements and qualifications for these programs based on the loan amount, down payment and property conditions. And the U.S. Department of Veterans Affairs backs a portion of the home loans to veterans and their families that don’t require a down payment. Be aware, however, that mortgages with less than a 20% down payment are often accompanied by private mortgage insurance, which is an extra monthly expense added to your mortgage.

Conditions

The fifth C looks at the market conditions that serve as the background music to your home purchase. While the other four C’s are personal to you, this fifth C is the “big picture” stuff.

“Conditions” can include everything from interest rates and mortgage rates to cost of living and how many homes are on the market in your area.

The real estate market is very local. So it can help to understand the supply-and-demand situation in the areas and price ranges you’re targeting. In a “buyer’s market,” where supply exceeds demand, you often have more leverage to bargain because there are a lot of houses available, so it can become more difficult for sellers. In a “seller’s market,” where demand exceeds supply, the seller may have the upper hand.

Action steps

  • Get preapproved for a mortgage. One rookie mistake: Shopping for a home and then applying for financing. Instead, try to shop for financing first. The lender will fully vet you for a mortgage and give you a preapproval letter for a specific loan amount. Preapproval can help you move faster when you do find the home you want. And with preapproval already in hand, you’ll likely be viewed as a more attractive buyer.
  • Comparison shop for the best mortgage deal. About 77% of homebuyers apply to only one lender, according to data from the Consumer Financial Protection Bureau. With an often six-figure purchase, says Keys, “it’s worth doing some shopping to make sure you’re getting the best possible value.”

If you want to really shop around, investigate a variety of lending sources, including large and independent banks, credit unions and mortgage companies. Then ask what types of mortgages they can offer. And have a shopping list for the talking points that are important to you — like rates, collateral, capital reserves, DTIs and credit score requirements.


Bottom line

Ultimately, the five C’s of credit boil down to a sixth C: confidence. Namely, a lender’s confidence “that you can pay your debt,” says Zigas.

But knowing the five C’s of credit can also give you confidence at a crucial time. (Sort of like having the exam questions in advance for the big test.) You can use them to help you prepare, shop smart, and select the home and mortgage that will best fit your life and your finances.


About the author: Dana Dratch is a personal finance writer (and coffee fanatic). She covers credit, money and lifestyle issues. Read more.

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Best VA Loan Lenders of 2021

Interest rates have fallen across the lending spectrum, including mortgages. Earlier this spring mortgage rates reached their lowest point ever. These low rates also apply to the VA home loan program.

If you’re eligible for a VA home loan, now is an excellent time to take advantage of these low rates, either to purchase a home with no down payment or to refinance your current mortgage through one of the best VA lenders.

You can apply for a VA mortgage loan through any lender that participates in the VA home loan program. But some lenders originate VA loans only occasionally which means they are only minimally familiar with the guidelines.

For that reason, you should focus your efforts on the mortgage lenders that specialize in VA loans and can make the process as effortless as possible.

The 7 Best VA Loan Lenders

Here are the best VA mortgage lenders:

  1. Veterans United
  2. Veterans First
  3. Quicken Loans
  4. Rocket Mortgage
  5. Navy Federal Credit Union
  6. USAA
  7. PenFed Credit Union

Veterans United Home Loans

Veterans United Home Loans Logo

Veterans United Home Loans is the largest VA mortgage lender in the country. This VA loan specialist operates in all 50 states, so you can work with this company no matter where you are stationed or live. You can begin the loan application process either online or by phone.

Veterans United even engages the services of former senior enlisted leaders from each branch of the armed services to help guide you on the specific loan requirements for active duty military personnel.

Veterans United also offers several valuable programs to help manage your home buying experience. This lender can provide direct assistance throughout your home buying process through a network of real estate agents who specialize in working with veterans.

Learn More: Read our full Veterans United Home Loans Review.

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Veterans First Mortgage

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Veterans First Mortgage is another major lender specializing in VA loans. But they also offer FHA loans, which can also be important to veterans. If for any reason you’re unable to qualify for a VA loan, an FHA mortgage could be a viable Plan B.

Veterans First has been a VA lender since 1985 which gives this lender a wealth of experience dealing with these highly specialized loans.

You’ll be assigned a VA loan specialist who will work with you through the entire process — from getting your Certificate of Eligibility to closing on your loan, making the experience more stress-free. You just can’t find this level of service with most private lenders.

This kind of support can be especially important to first-time home buyers who need extra guidance with their mortgage applications.

 

Quicken Loans

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Quicken Loans is the largest mortgage originator in the United States, operating throughout the country. Quicken is not a VA loan specialist but it writes enough home loans to have a lot of experience with the VA loan program.

In addition to providing VA loans, Quicken Loans also offers all other types of mortgages, including conventional, FHA, Jumbo, and USDA loans.

This availability of other loan types may be significant if your military service doesn’t qualify for a VA mortgage, or if a VA loan won’t fit your mortgage needs. For example, if you need financing for a vacation home or an investment property, you’ll need a conventional mortgage. A lender that offers only VA loans may not be able to help you with that kind of purchase.

Quicken Loans also rates very highly for customer service, and has the advantage of servicing the loans it originates. That means you’ll be making your payments directly to the same company.

Learn More: Read our full Quicken Loans Review.

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Rocket Mortgage

rocket mortgage va loan

Rocket Mortgage is part of Quicken Loans, serving as its online mortgage lending arm. Rocket offers all the advantages of Quicken Loans, but adds the convenience of an all-online process.

This means there’s no need to meet with a loan officer face-to-face. The entire process can be completed online, including uploading your documents. This can lead to fast approvals and closings within a reduced time frame.

Like Quicken Loans, Rocket Mortgage also originates a lot of VA loans as well as other mortgage types.

Learn More: Read our full Rocket Mortgage Review.

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Navy Federal Credit Union

navy federal credit unionUnlike the previous four lenders on this list, Navy Federal Credit Union serves only military members which means its mission aligns perfectly with the U.S. Department of Veterans Affairs which regulates the VA home loan program.

You’d have to join Navy Federal before applying for a loan, but service members from any branch qualify for membership. Defense contractors and even some Department of Defense civilian employees can also join.

Once you’ve joined, you’ll have access to some of the lowest rates in the market. And you’ll get expert guidance through the borrowing process.

Navy Federal has 15- and 30-year term VA loans. This lender also considers alternative borrowing criteria in case your credit history doesn’t hold up. For example, you could get credit for making on-time rent payments for the past few years even if you don’t quite meet the minimum credit score. Keep in mind your interest rate would likely increase.

 

USAA

USAA LogoThis military-only association started out as an auto insurance provider and has steadily grown, expanding into banking and mortgages. Naturally, the VA home purchase program fits within USAA’s stable of products.

Only active duty military members and veterans can join USAA. While it serves members in all 50 states and stationed around the world, USAA has only a handful of physical offices. You’d access this lender’s mortgage products online or over the phone.

USAA does not offer FHA or USDA loans. You also won’t find a home equity line of credit. More than half of this financial institutions mortgage loans are backed by the U.S. Department of Veterans Affairs which means you’ll be working with a true VA loan specialist.

If you’re refinancing a VA home loan in hopes of getting a lower rate, USAA offers an attractive version of the VA streamline (IRRRL) refinance. USAA won’t charge an origination fee for this refinance loan.

 

PenFed Credit Union

penfed credit union logoPenFed — short for Pentagon Federal — Credit Union also specializes in VA purchase loan options for U.S. military members and veterans.

Like Navy Federal and USAA, you’d need to join PenFed before applying for a loan. But membership has its privileges which include competitive interest rates and a smooth loan process.

PenFed has one of the most open enrollment policies of any military-based credit union. Defense contractors along with active duty service members and veterans from any branch can join PenFed. Civilian employees of the DoD can join. Even volunteers in the American Red Cross can join.

But only military members and veterans can get a VA home loan. Other members can get a home equity line of credit, a jumbo loan for a high balance mortgage, or a conventional loan or refinance.

 

What Is A VA Loan?

VA loans are a special program created by the United States government and managed by the Department of Veterans Affairs. They exist to help eligible active duty members of the military, as well as veterans, buy safe and affordable housing.

VA lenders help you get a new home loan with no down payment and no private mortgage insurance premiums. We’ll explore these benefits in the next section below.

VA purchase loans or refinance loans can go to members from any branch of the military, including the Army, Navy, Air Force, Marines, Coast Guard, the National Guard and the Reserves.

VA loans are not actually made by the Veterans Administration. Instead, the loans are provided by private institutions, like banks and mortgage companies on my list above. Mortgage insurance is provided by the VA which gives the loan program its name.

That mortgage insurance acts as an inducement for lenders to make loans to eligible veterans. The insurance lets lenders worry less about the losses they might sustain from foreclosures, opening the door to more favorable lending terms for veterans.

What Are The Benefits of a VA Loan?

VA loans have many benefits, some of which are unique to this particular loan type:

  • No down payment requirement: Up to certain very generous loan limits, VA loans offer 100% financing. This is tough to find elsewhere in the mortgage market.
  • No monthly mortgage insurance (PMI) premium: Both conventional and FHA mortgages require some kind of borrower-paid mortgage insurance. VA loans don’t. Instead, you’ll pay an upfront mortgage insurance premium that’s added to your loan amount and financed over the term of the loan. This will result in a lower monthly house payment than you might otherwise have.
  • Seller-paid closing costs: VA allows property sellers to pay closing costs equal to as much as 4% of the loan amount/purchase price. Since closing costs typically average between 2% and 4%, you could avoid paying out of pocket for closing costs. In combination with the 0% down payment requirement, VA loans are true 100% financing arrangements.
  • Interest rates on VA loans are often lower: The rate advantage in this mortgage program may be small — perhaps only 0.125% or 0.25%. But it will still result in slightly lower mortgage payments than would otherwise be the case.

How Do VA Loans Work?

VA loans have several “moving parts. Each is described below:

Loan Types and Terms

VA loans are available in terms ranging from 15 to 30 years. They’re also available in both fixed-rate and adjustable-rate mortgages (“ARMs”).

As the name implies, a fixed rate mortgage has a fixed interest rate and fixed monthly mortgage payment throughout the term of the loan.

An adjustable rate mortgage will typically come with a fixed rate and fixed monthly payment for the first five years, then adjust each year thereafter. The new rate and payment can be either higher or lower than the initial rate and payment.

But to limit how much borrowers will pay on an ARM, the VA “caps” the loan. With a VA loan, the rate can increase by no more than 1% in any one year, or 5% over the life of the loan.

For example, if your initial rate is 3%, the highest the rate can be after the first adjustment is 4%. Over the life of the loan, the maximum interest rate will be 8% (3% + 5%).

Whether you take a fixed-rate or adjustable-rate mortgage, the loan will be completely paid off at the end of the loan term.

VA Funding Fee

FHA mortgages require mortgage insurance that includes both an upfront fee (that’s typically added to your mortgage loan balance), and a monthly premium that’s part of your new monthly payment. Conventional mortgages have private mortgage insurance (PMI), which adds a monthly premium to your house payment, but does not require an upfront amount.

The VA imposes a “Funding Fee”, which is an upfront charge added to the loan amount and financed over the term of the loan if necessary. There is no monthly mortgage insurance premium.

The purpose of mortgage insurance is to provide assurance to the mortgage lender that at least part of the loan will be reimbursed upon foreclosure.

In the case of VA loans, the Veterans Administration insures 25% of the loan amount. If you default on a $200,000 loan, the VA will pay the lender $50,000. Presumably, the remaining $150,000 will be covered out of the proceeds of the sale of the property.

The amount of the VA Funding Fee will depend on the type of loan, the amount of the down payment made, and whether it’s a first time for the subsequent use of your VA eligibility:

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Maximum Loan Amount

Technically speaking, there’s no longer a maximum VA loan amount. However, to get 100% financing, the maximum loan amount ranges between $510,400 and $765,600, depending on the county where the property is being purchased.

These limits will apply only to veterans with one or more outstanding VA loans, or to those who have defaulted on a previous VA loan.

But if you still have your full entitlement, and you’ve never defaulted on a previous VA loan, the loan amount can be as high as a lender is willing to grant. However, if you do exceed those limits, you’ll need to come up with 25% of the difference as a down payment.

For example, let’s say the property you’re purchasing is located in a county with a $600,000 loan limit. You can purchase a property for $800,000, but you’ll need to make a $50,000 down payment.

The $50,000 is 25% of the $200,000 that the purchase price will exceed the $600,000 county limit.

Loan amounts in excess of the published county limit are commonly referred to as VA Jumbo loans.

Eligible Property Types

Eligible property types for a VA loan are restricted to 1 to 4 family residential properties that will be owner-occupied either by the veteran or a member of the veteran’s immediate family.

Unlike conventional mortgages, VA loans are not available for financing vacation homes for investment properties.

All properties must meet minimum local standards for safety and livability, including proper functioning of the major components of the home.

How to Qualify for a VA Loan

While VA loans are specifically designed for eligible active duty and retired members of the military, each borrower will need to qualify based on his or her own merits. Several factors go into this determination.

Eligibility

Eligibility begins with the Certificate of Eligibility (COE). If you don’t have it available, your lender should be able to assist you in obtaining this certificate from the Department of Veterans Affairs. The COE should be available if you were not dishonorably discharged, and you meet the minimum active duty service requirement based on when you served.

You can check the eligibility requirements directly with the Veterans Administration, but below are the most common situations:

  1. You’re eligible if you have been on active duty for at least 90 continuous days.
  2. If you served between 1980 and August 1, 1990, you’ll need 24 months or at least 181 days on active duty.
  3. Between August 2, 1990 and the present, at least 90 days of active duty, or at least 90 days of your discharge for a hardship, reduction in force, or for convenience of the government, or less than 90 days if your discharge is for a service-connected disability.

Different service requirements apply to earlier time periods.

Credit Score Requirements

VA loans have no stated minimum credit score requirements. However, most lenders impose a minimum FICO credit score requirement of 620. Some will make loans to eligible veterans with lower scores, but will charge a higher interest rate if they do.

Exactly how high the rate will be will depend on your credit report and other details of your overall qualifications.

Debt-to-Income (DTI) Requirements

Generally speaking, VA loans are permitted with a debt-to-income ratio of up to 43%. Debt-to-income ratio (DTI) is calculated by dividing your total fixed monthly debt payments by your stable monthly income.

Fixed monthly payments include your proposed monthly house payment, plus monthly payments for auto loans, student loans, credit cards, child support, alimony, and other recurring payments.

This ratio does not include payments for utilities, insurance premiums (including health insurance), retirement contributions, and other variable or optional monthly costs.

If your overall credit qualification is strong, the lender may permit a debt-to-income ratio of up to 50%, but that will increase the interest rate you’ll pay on your loan.

In rare cases, a DTI exceeding 50% may be permitted, but it will result in an even higher interest rate and monthly mortgage payment. The lender may also require strong compensating factors, such as making a down payment, a decrease from your previous house payment, or a large amount of savings after closing.

Cash Requirements

Since VA loans require no down payment up to the county maximum loan limit, and closing costs can be paid by sellers, homebuyers may need no money up front at all.

You may need cash out of pocket if:

  • the seller refuses to pay your closing costs up to the 4% of the loan amount allowed by the VA.
  • the purchase price of the property you’re buying exceeds the maximum county loan limit, requiring you to come up with a down payment equal to 25% of the excess amount.

In most other situations, you should be able to purchase a home with no cash upfront whatsoever.

Factors Affecting VA Loan Interest Rates

Base interest rates for VA loans are determined by market interest rates. Mortgage rates, in general, are based on the 10-year U.S. Treasury note. That rate serves as a base, and a margin is added to it to compensate the bondholders who ultimately fund the loans.

But apart from the market-driven base rate, there are several factors that will affect the rate you’ll pay. Some of those factors were mentioned in the above section, but we’ll list them again here:

  • Loan amount: Loans below $250,000 will include a slight rate increase, as will loans that exceed the local county limit.
  • Credit history: The rate you see published by any lender will probably be for someone with a credit score of 700 or higher. Lower scores will result in higher rates.
  • Debt-to-income ratio: A DTI greater than 43% could increase your rate.
  • The length of your rate lock: The longer your rate lock, the higher your mortgage rate. Normally you lock in a rate with your preapproval which gives you time to shop for a home without worrying about a rate increase.
  • Lender-paid closing costs: If a seller won’t pay some or all your closing costs, your lender may pay them in exchange for a slightly higher interest rate.
  • The term of your loan: 30-year loans have higher rates than 15-year loans. The 15-year option requires higher monthly mortgage payments but costs less in total interest paid throughout the life of the loan.

Are VA Loan Rates Different Between Purchases and Refinances?

The VA offers a unique refinance program referred to as the Interest Rate Reduction Refinance Loan, or simply IRRRL. The advantage with this loan is that it requires less documentation.

For example, since you’re replacing an existing VA loan on which you are already making payments, the lender won’t verify your credit, employment or income. They may not even perform a property appraisal.

Because of the simplicity of IRRRLs, rates are often lower than other loan types, including VA loans for purchases. What’s more, the VA  Funding Fee on IRRRLs is just 0.5%, which is lower than the fee for other VA loan types. And since documentation is extremely limited, you can complete an IRRRL in a lot less time than it will take for a purchase mortgage.

A critical element with an IRRRL is that you cannot use it for a cash-out refinance that would tap your home’s equity. You’re simply replacing the existing VA mortgage with a new one with a lower interest rate. However, the program does allow you to add loan closing costs to the new loan amount.

To do an IRRRL you must be refinancing an existing VA mortgage. Conventional and FHA mortgages are not allowed. You also cannot have more than one 30-day late payment on your current mortgage within the past year. The rate on the new loan must be lower than your current rate, unless you are refinancing from an ARM to a fixed-rate loan. The property must also continue to be your primary residence.

What if you want an actual cash out refinance? To get cash out of your home’s equity you’d need a conventional or FHA loan. You could also get a home equity line of credit from a traditional bank or credit union to access your stored up home value.

Is A VA Loan Best For You?

VA loans are one of the very best mortgage types available. If you’re an eligible veteran or active duty member of the military, you should absolutely take advantage of this program for your home financing needs. Get your pre-approval from a qualified VA lender today to start your mortgage process.

amerivalue mortgage types

AmeriValue Review | Mortgage Options

When buying or refinancing a home, it’s essential to work with a lender that you can trust. In doing so, you stand to benefit from mortgage terms that are best suited to your financial needs.

With the help of an online mortgage aggregator like AmeriValue, you’ll be on your way to getting a great mortgage in no time.

Table of Contents:

  • How Does AmeriValue Work?
  • Mortgage Options
  • Qualifications
  • Pros & Cons

How Does AmeriValue Work?

As an online mortgage aggregator, AmeriValue helps users to connect with different mortgage lenders so that they can find the best possible loan.

The process of finding a loan with AmeriValue can vary depending on the specific type of loan that you want. Overall, it’s a great way to compare different loan rates as you shop around for home loans.

By using AmeriValues’ simple online application form, you can quickly and easily start to get loan offers by email. This questionnaire-like form requires minimal information, and that makes it relatively hassle-free when compared to some loan applications. Once your application is complete, all that’s left is to sift through the loan options that you receive until you find one that’s right for you.

AmeriValue can connect users with as many as five different loan originators. It’s an excellent way to compare loan terms from competing lenders so that you can see what kind of options you have.

amerivalue mortgage types

 

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AmeriValue Mortgage Options

AmeriValue works to connect its users with lenders who provide a variety of common loan types. These include conventional, FHA, and VA loans.

It’s important to note that the loan options available through AmeriValue are not extremely varied when compared to similar lending services. If you’re searching for a specific loan type that is not very common, this company may not be able to help you with finding a lender who offers it.

Listed below are some of the most popular mortgage options that AmeriValue can offer.

Conventional Loans

This loan type is becoming increasingly popular thanks to the fact that it offers low rates and flexible guidelines. The government does not back these loans in any way, and they are especially convenient for first-time borrowers.

If you have a satisfactory credit score and can make a down payment, you should qualify for a conventional loan.

Refinancing Loans

If you already have a mortgage, that doesn’t necessarily mean that you must continue paying it back according to your current payment plan and interest rate.

Refinancing is a great way to alter your existing mortgage so that you can reap benefits such as lower monthly payments and better interest rates.

FHA Loans

As the name suggests, FHA loans are given out by the Federal Housing Administration. These loans are ideal for low-income and moderate-income borrowers, and you can even get approved for a mortgage with a credit score as low as 500.

While having a low credit score will require a bigger down payment, it’s still an excellent option for somebody who would like to take out a mortgage even though their financial history is less than perfect.

VA Loans

If you are a veteran, active military member, or a surviving spouse of a veteran, VA loans offer unique borrowing terms that are a bit more advantageous than your standard mortgage.

For more detailed information on this type of loan, be sure to visit the U.S. Department of Veteran Affairs’ website.

AmeriValue Mortgage Qualifications

When asking what qualifications are necessary to find a loan through AmeriValue, it’s important to keep in mind that AmeriValue’s function is to connect lenders and potential homeowners. As such, it is a bit complicated, to sum up, the necessary qualifications for AmeriValue since the requirements differ based on the lender and loan type. Still, there is some basic information that you can use as a benchmark for determining your eligibility for a given kind of loan.

First off, the minimum credit score needed to qualify for an FHA loan is 580. The government regulates this credit score standard, so you won’t have any luck trying to get an FHA loan if your credit score is lower than that. Furthermore, many lenders ask for an even higher credit score of 620 for the most common loan types.

After you’ve decided on a lender and loan from the options that AmeriValue has sent to you, you should be prepared to supply some basic information and documentation. The required documentation usually includes vital personal information, such as your birthday, income, financial history, and other such details. You may also need to provide pay stubs and tax documentation from the past year or two to verify the status of your financial situation.

For exact details on mortgage qualifications or the loan application process, you’ll have to communicate directly with your potential lender. AmeriValue is a great way to get connected, but from there, you’ll have to undergo the application process according to the standards and regulations that your lender has set.

Pros and Cons

One huge advantage that AmeriValue boasts is that you can use it free of charge. From that point of view, it’s a great deal for anyone who’s looking to find the best loan for buying a new home or refinancing their current home. All you must do is quickly complete the online application, and AmeriValue will send you loan options based on the information that you provided.

AmeriValue helps connect potential homebuyers with some of the most commonly sought-after loan types. While this is great for most users, it may not be ideal for somebody looking for a particular kind of loan. Fortunately, the online form is very user-friendly, and it takes only a little time to complete.

AmeriValue is helpful, but only up to a certain point. Once you’ve completed the form and received a list of potential lenders and loans, everything else that follows is strictly between you and the lender. At this point, the job of AmeriValue.com is complete as they are neither a lender nor a mortgage brokerage. They serve only as a conduit to connect borrowers and lenders.

North American Savings Bank Mortgage Review

Throughout the real estate buying process, whether first time home buyers or accomplished commercial property buyers, one of the most critical decisions is choosing which financial institution to finance your home.

There are a variety of different loan programs to choose from (think home mortgage jumbo loans or commercial loans) and there are a vast number of lenders eager for you to open a new mortgage loan with their company.

Let’s take a closer look at North American Savings Bank and see what kind of experience you can expect to have when shopping for a mortgage there.

Table of Contents:

  • NASB Overview
  • Mortgage Options
  • Qualifications
  • Fees
  • Pros & Cons
  • Contact Information

Overview of North American Savings Bank

Located in Missouri, North American Savings Bank is an FDIC backed national bank and mortgage lender that offers mortgages to a broad range of borrowers.

Specifically, it gears its services towards active U.S. military members and U.S. veterans. However, they offer several types of banking services including:

  • Savings Accounts
  • CD’s
  • Checking Accounts, some with no minimum balance fees
  • Money Market Accounts
  • Commercial Loans
  • Mortgage Loans

NASB also offers a mobile app and online banking, keeping up to date with other banking competitions.

In fact, their debit card works with Apple Pay, Google Pay, and Samsung Pay when making purchases using your mobile phone.

Most of their mortgages are processed through the Department of Veterans Affairs, but they also offer several other typical home loans that you would expect to get from any bank.

You can begin your mortgage application process through an online application, via phone, or in-person loan application at your nearest NASB branch.

From there, a loan officer will contact you to start finalizing the terms of your new NASB account mortgage rates and therefore mortgage payment.

NASB also considers non-traditional income sources, so applicants that have a low credit score are more likely to get approved when applying for a mortgage here.

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NASB Mortgage Options

Whether you plan on taking out an entirely new mortgage or you want to refinance your existing mortgage, North American Savings Bank has a few different financing options to meet the needs of its customers.

They are competitive with other loan companies like Quicken Loans, and have competitive rates, all depending on your loan amount and credit score.

Here are a few of the most popular loans that they offer:

  • VA
  • Fixed
  • HELOC/Home Equity
  • Purchase
  • Refinance
  • Jumbo
  • Adjustable-Rate
  • FHA
  • IRA Non-Recourse Loans for Investment Properties

Conventional Loans

These are loans that are not backed by the government. They tend to have higher interest rates than their government-backed counterparts.

Still, it may be possible that a conventional loan is the type of mortgage that is best suited to your needs.

Government-backed Loans

If you take out a loan from any government entity, then that’s known as a government-backed loan.

One of the most common government loans is an FHA (Federal Housing Association) loan. NASB provides customers with a variety of government-backed loans.

Be aware that if you take out an FHA loan, the Federal Housing Administration is not the one that will provide the credit.

The money is given to you by an individual FHA-approved institution like NASB, and the FHA merely serves to back the loan.

VA Loans

VA loans are one of the most popular loans that NASB offers, and they provide favorable borrowing terms for active members of the military, veterans, and widowed spouses of veterans.

To confirm your eligibility for a VA loan, visit the Department of Veteran Affairs website.

Mortgage Refinance

One of the easiest and simplest ways to improve your mortgage’s repayment terms is by refinancing.

While this option may not be for everybody, it allows many borrowers to enjoy lower monthly payments, a lower interest rate, and payment terms, which are overall more favorable than those of the original mortgage.

Cash-Out Refinance

A cash-out refinance loan differs from a standard mortgage refinance in one significant way: the balance on the new mortgage that you receive through this process is higher than the amount of your home payment.

The logic here is that with the remaining money you have after making your home payment, you can fund other aspects of your life.

Many borrowers who opt for a cash-out refinance to use the money for home improvements.

Be aware that with this type of refinancing, you’ll need to borrow the new mortgage against home’s equity.

NASB Mortgage Qualifications

NASB differs from other lenders in their loan qualification process. Rather than merely looking at your credit score, they also consider your financial history based on other indicators, such as your bill and rent payment history.

Though their standard minimum credit score is 620, there are specific loans they offer that will accept even lower scores.

Their Good Neighbor Program, for example, only requires a credit score of 580. That way, moderate-income and low-income borrowers have a chance to get a mortgage at NASB.

Naturally, the qualification standards and assistance that NASB offers vary depending on the loan.

Overall, NASB offers mortgage qualification requirements that are forgiving when compared to other lenders. If you are a military borrower with low-to-moderate income, this would be a great lender to consider.

NASB Mortgage Fees

North American Savings Bank does not charge a fee to lock in your loan rate. NASB does, however, charge an origination fee of $995 on all its loans except for VA loans.

These fees should include the appraisal fee, title company charges, closing fees, and state taxes.

They also charge credit card and debit card payment fees at $44.55 per payment. Be sure to speak with your loan officer concerning the details of your fees.

Pros and Cons

Pros

  • VA Loans: One advantage that NASB customers agree on is that this bank is big on serving military families through VA loans. They make an effort to thank veterans and active military members by helping them to find the most favorable mortgage borrowing terms. While other banks and institutions also offer VA loans, NASB stands out in this regard.
  • Non-Traditional Income Sources Considered: In addition to honoring those who have served, NASB also takes non-traditional income sources into account when customers apply for a loan. Examples of this include your payment histories for rent, utilities, insurance, and mobile phone bills. Many lenders are quick to judge you based on your credit score alone, but NASB works to give its clients alternate routes to finding a great mortgage.
  • Good Neighbor Program: If that weren’t enough, NASB also helps low-income customers through their Good Neighbor Program. This initiative is designed to help people buy properties in Kansas City, Missouri, even if their credit score and financial history are less-than-perfect. The program works by requesting a minimum credit score of 580, waiving any lender fees that would typically be required, and helping borrowers along with paying for closing costs.
  • Solid Reputation: NASB has a solid reputation, and you can always check in with your loan officer at any point during the loan process.

Cons

  • No Online System: The only downside we see from NASB bank is that it doesn’t offer an online system for tracking your loan process. While this may be unnerving to some, some borrowers don’t care to use such systems.
  • Higher Rates on IRA Non-Recourse Loans: Their IRA Non-Recourse Loans for investment properties come with higher interest rates and a hefty 30% down payment.

NASB Contact Information

North American Savings Bank contact information is the following:

  • Address: 12498 S 71 Highway Grandview, MO 64030
  • Phone number: 816-943-8000
  • Website: www.NASB.com
  • ​NMLS ID# 400039

Is North American Savings Bank for You?

Due to their excellent reputation, flexible qualification standards, and a variety of mortgage offerings, you can’t go wrong with NASB.

getsmart logo

GetSmart.com Mortgage Review

Finding a great mortgage can involve a lot of research and comparing various lenders.

However, the work that goes into it is well worth it when you consider how much money you can save by taking out a mortgage with superior borrowing terms.

By getting pre-qualified for a mortgage through GetSmart.com, you can efficiently shop through a variety of loan types until you find the one that’s perfect for you.

Table of Contents:

  • How GetSmart.com Works
  • Mortgage Options
  • Qualifications
  • Pros & Cons

How GetSmart.com Works

getsmart logoGetSmart.com is an online service that takes your basic info and then directs you to a mortgage shopping system called LendingTree. LendingTree, based in North Carolina, is the lender exchange that operates GetSmart.com.

GetSmart.com uses a streamlined, user-friendly application system to pre-qualify customers before funneling them to LendingTree’s online mortgage shop. Once there, you can shop around among different loans for which you are pre-approved.

One great thing about GetSmart.com is that the mortgage lenders it features are all required to meet specific quality standards before they can join the network. Vetting lenders in this way ensures that users only have reputable banks and finance companies to choose from when shopping for loans.

LendingTree (Get Smart’s parent company) maintains a Trustpilot score of 9/10. This score is relatively high for a financial institution, and it’s a reliable indicator that GetSmart.com is a reputable resource for mortgage shopping.

GetSmart.com makes an excellent starting point if you’re shopping for a mortgage. It can efficiently help you to research different loan options in an organized manner so that you can save time and money.

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GetSmart.com Mortgage Options

GetSmart.com can help you find a variety of loans to suit your needs.

After you submit your application, it can direct you to a lending exchange that allows you to compare potential loans from various lenders.

Here are a few examples of some of the most popular loans that you can find through GetSmart.com:

Conventional Loans

Loans that are not backed by a government entity are considered conventional loans.

This loan type accounts for approximately two-thirds of homeowners’ loans issued in the United States.

Often, conventional loans have higher interest rates than loans which are government-backed.

FHA Loans

FHA-approved lenders issue federal Housing Administration loans, and they are prevalent for first-time homebuyers.

FHA loans are primarily intended for low-income borrowers.

These loans typically require lower down payments and lower minimum credit scores when compared to other loan types.

Remember: the FHA doesn’t directly give you money if you take out an FHA loan.

They guarantee the amount which is lent to you by an FHA-approved lender, such as a bank or other financial institution.

VA Loans

VA loans create excellent opportunities for veterans, active members of the military, and spouses of deceased veterans.

For example, they require no money down and usually come with low closing costs when compared to other loan types.

Thanks to the added benefits and flexible borrowing terms of VA loans, those who have served have a chance to be rewarded for their sacrifices when buying a home.

For more information on whether you qualify for a VA loan, be sure to check out the Department of Veterans Affairs website.

Jumbo Mortgages

Should you plan on buying a luxury home, a jumbo mortgage is the loan type for you.

Depending on where you live, you can take out one of these super-sized mortgages for an amount between $424,100 and $636,150.

The range for jumbo loans is set to conform to the loan limits for the Federal National Mortgage Association.

It should come as no surprise that you need to have a reasonably good FICO credit score of around 700 to qualify for a jumbo mortgage.

You should also expect to pay a 20% down payment with this loan type.

Learn More

GetSmart.com Mortgage Qualifications

Each lender which you can find through GetSmart.com has specific lending terms depending on what kind of loan you want to take out.

It is difficult to generalize on the mortgage qualifications of so many lenders.

However, there are a few standards within the mortgage-borrowing world that we can suggest as a starting point.

Low-income mortgages and FHA loans tend to have a minimum credit score requirement of 580.

Most conventional mortgages, on the other hand, tend to put the required credit score minimum at 620.

LendingTree advertises their minimum down payment can as low as 3.5%.

It’s important to note that not every lender within their network is going to abide by that number.

Your best bet is to inquire directly with a specific lender to get the most accurate information on their mortgage qualifications.

Pros and Cons

A significant advantage of using GetSmart.com is they require lenders within their network to meet specific quality standards. This vetting helps to filter out unreliable lenders, and it allows potential homebuyers to find the best mortgages quickly and easily.

LendingTree’s network also offers a wide range of loans that appeals to the diverse needs of its users. From FHA loans to jumbo loans, it can help you find the loan which is best suited for your individual situation. Thanks to this vast and varied lender network, users can get a comprehensive look at multiple existing options.

All in all, Get Smart’s pre-qualification process is clear-cut and exceedingly simple. All you must do is answer a few questions to determine which loans you should consider. After completing the application and providing your basic information, different lenders can contact you and provide you with more specific information on their loans.

You should be prepared to provide documentation to prove your income and financial status for the lender to verify.

GetSmart.com is not actually a lender. They serve only as a conduit to connect borrowers and lenders. As a result, you’ll need to research the specific details of individual lenders and loans after you have found it through GetSmart.com.

However, it still makes for a great place to start the search, especially if you’re trying to assess what are your best options based on your specific situation.

guide to lenders logo

Guide To Lenders Review | Mortgage Options

Are you currently looking to take out a mortgage? If so, you must find one that offers you the most favorable terms so that you can pay it back as effectively as possible.

GuideToLenders is an online platform that can help you compare different loans until you find the ideal one for your situation.

Table of Contents:

  • How GuideToLenders Works
  • Mortgage Options
  • Qualifications
  • Pros & Cons

How Guide To Lenders Works

guide to lenders logoGuide To Lenders has allowed hundreds of users to compare different loans from top lenders so that they compare options efficiently. It’s completely free, and you can quickly receive multiple offers from lenders just by filling out the form on their website.

Once your application is complete, you merely need to review your loan offers and decide as to whether any of them are the right fit for you.

Shopping around for the best loan is a fantastic way to save big on your mortgage. Guide To Lenders is 100% free and gives you the resources to compare different lenders. It’s a service worth considering as you shop around for a mortgage.

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Guide To Lenders Mortgage Options

Although GuideToLenders doesn’t directly offer loans to users, it helps them by taking their information and recommending potential lenders and loans that match with it.

Below are some of the most common loan types you might find after filling out the application form on the GuideToLenders website:

Refinance

Refinancing is one of the best ways to ensure that you are getting the best terms for your mortgage. In many cases, it can lead to lower monthly payments on your mortgage and better interest rates so that you can pay back your loan as efficiently as possible.

Refinancing is not for everyone, so be sure to carefully assess whether this option would benefit you in the long run.

Home Loan

Once you consider how much money you make, how much you can put down on a home, and some other factors, you’ll be able to determine what kind of home loan is best for you. Different loans come with specific terms, monthly payments, and interest rates, and it’s essential to shop around before committing to a loan from a lender.

Guide To Lenders is a great online platform for comparing home loans while you research your options.

Home Equity

The main difference between a home equity loan and a standard home loan is that you can only take out a home equity loan after you have equity in a property.

Mortgages and home equity loans both require you to put up the property as collateral, but a home equity loan is secured by the equity you have in the property.

Naturally, the terms for different home equity loans depend upon the lender from which you request the loan.

Personal Loan

One of the most significant differences between a personal loan and a mortgage is that a personal loan is not secured. Personal loans tend to have higher interest rates, shorter loan terms, and lower maximum loan amounts when compared to mortgages.

While the reasons above might make personal loans seem like a less favorable option for buying a home, you should still consider if they might be the right move for your financial situation.

Learn More

Guide To Lenders Mortgage Qualifications

First off, it’s important to remember that Guide To Lenders does not provide loans directly. It merely provides users with various loan offers, and from there, everything is between the user and the potential lender.

However, you do need to meet a few qualifications before using GuideToLenders:

  • You must be a United States citizen
  • You must be at least 18 years old
  • You must own a valid bank account
  • You must have a steady source of income

If you can check those four items off the list, then you’re ready to start using Guide To Lenders. Their application will ask for your name, annual income, date of birth, and contact information, but you won’t have to provide too much detailed information. Guide To Lenders also performs a soft credit inquiry, but this will not affect your credit score.

After you’ve submitted your application, you’ll receive a few loan offers best matched with the information you provided. At that point, all requirements and application procedures will have to be submitted according to the lender’s specific criteria.

Remember, you have no obligation to pursue any of the loan offers that you get from Guide To Lenders, and there is no sanction for deciding against pre-approved loans from this company.

Pros and Cons of GuideToLenders

Pros:

  • Free Service: One huge incentive for using GuideToLenders is the fact that it doesn’t cost a cent. The free service allows you to compare loan options from the nation’s top lenders so that you can find the loan that’s right for you.
  • Simple Platform: Another advantage of this online platform is how simple and quick it is to get pre-approved for loans. The application is fast, easy, and only requires a soft credit check. That way, you don’t have to worry about any adverse effects on your credit score.
  • Extensive Lender Network: Guide To Lenders has an extensive lender network, so it can help borrowers with various types of credit scores to find the right loans. Even if you have a poor credit score, typically making the loan process more difficult, this platform can help you to find a loan that will allow you to finance your home.
  • No Obligation: It’s also a huge plus that loan offers received through Guide To Lenders carry no obligation. You can choose to not proceed with any of them, and there are absolutely no repercussions for doing so.

Cons

  • Not a Direct Lender: The only downside to Guide To Lenders is they do not act as a lender. They are merely a conduit to connect borrowers with lenders. Once you receive loan offers through their platform, you’ll have to take on the process of applying for the loan with your chosen lender on your own.

Since there is no cost to use the GuideToLenders service, trying out their platform to match you with lenders is a winning play.

magnolia bank mortgage

Magnolia Bank Mortgage Review

Buying and refinancing a home is a major decision, and you want to take out a mortgage with a bank that you can trust.

Based in Hodgenville, Kentucky, Magnolia Bank is one of the top 20 bank originators in the United States. Founded in 1919, the bank provides loan services in all 50 states.

Magnolia Bank is insured by the FDIC, has an A+ rating with the BBB, and has no complaints filed against it with the Consumer Financial Protection Bureau.

It’s no surprise that Magnolia bank generates over 1 billion dollars per year in home loans. They offer a variety of loan options so customers can choose the financing option which works best for them. This flexibility ties in well with their motto: “We Have a Personal Way.”

According to their website, “Magnolia Bank is committed to providing quality products and services to our customers, nurturing our employee’s professional growth, maximizing the return to our shareholders, and encouraging community involvement through our time and corporate resources.”

Let’s take a closer look at Magnolia Bank and get a general idea of its mortgage lending requirements for borrowers.

Table of Contents:

  • Magnolia Bank Mortgage Options
  • Qualifications
  • Getting Started
  • Pros & Cons

Magnolia Bank Mortgage Options

Magnolia Bank offers the following mortgage options for customers to choose from based on their specific needs and financial situation.

Fixed-Rate Mortgage

A fixed-rate mortgage is perfect if you want a consistent monthly payment. In a fixed-rate mortgage, the interest rate and monthly payment both stay the same throughout the term of the loan.

The biggest advantage here is that the loan holder does not have to worry about the interest rate going up at any point during the loan term.

VA Home Loan

VA loans provide unique benefits for those who currently serve in the military, those who have served in the military, and even spouses of deceased veterans. The loan terms are much more flexible than your average fixed-rate or ARM mortgage.

After confirming your eligibility with the U.S. Department of Veterans Affairs, you can start the process of taking out this specific type of loan.

FHA Home Loan

If you’re worried that your credit score may not be high enough to qualify for a home loan, then this option may be for you. Eligibility requirements for mortgages insured by the Federal Housing Administration are markedly less strict than many other loan types.

This loan type is one of the easiest to get, and it gives individuals with unfavorable financial histories a chance to buy a home or refinance.

Cash-Out Refinance

One of the most challenging parts of paying back a home loan is trying to do so with high-interest rates. However, a cash-out refinance loan may afford you the possibility of lowering your monthly payments even if you don’t have a stellar credit score.

The main difference between cash-out refinancing and basic refinancing is that a cash-out refinance will allow the borrower to take out more money than is needed to pay back your mortgage. The extra money is given to you to use towards home improvements, pay for college, or any other financial need.

Refinance

Refinancing is a common way to lower your monthly mortgage payment. This option can lead to significant savings, so you should consider it if you want to pay your loan back on more favorable terms. Refinancing is the process of replacing your current mortgage with a new one so that you can enjoy benefits such as lower interest rates or lower monthly payments.

Jumbo Home Loan

If you plan to purchase a high-value property, a jumbo loan is the perfect financing option. To qualify for a jumbo loan, the property being financed must meet the current conforming loan limit of $484,350 in most parts of the United States. You’ll also need to have a strong financial background (i.e., high credit score and low DTI ratio).

Keep in mind that you need to make a down payment of 20% when taking out a jumbo loan. Still, this is hands-down one of the best loan options for luxury homebuyers.

Compare Rates

Magnolia Bank Mortgage Qualifications

magnolia bank mortgageWhen applying for a mortgage at Magnolia Bank, there are a few qualifications that you’ll need to meet.

First, you need a minimum credit score of 620 (580 for FHA loans). Their mortgage application also requests standard personal information, such as your address, birth date, and income.

Once you’ve provided your necessary information and have received a loan proposal, you can move on to choosing the interest rate and loan terms from the options that the bank offers.

From there, you can begin the application for that specific loan. During this part of the loan process, you’ll be expected to provide some detailed documentation, such as your last two pay stubs, your tax forms (W2 or 1099 forms) for the previous two years, and a signed Borrower’s Certification and Authorization.

Loans from Magnolia Bank can be processed either online or by making a phone call. Since every loan is dealt with individually, it’s best to contact Magnolia Bank directly to determine the exact qualification requirements for your desired loan type.

Getting Started

With Magnolia Bank, it’s simple to get started. Just visit the Magnolia Bank website and get a free no-obligation loan analysis and rate quote all online with their easy to use the online form.

Learn More at Magnolia Bank

Is a Magnolia Bank Mortgage Best For You?

Magnolia Bank has an excellent reputation as a mortgage lender. Not only does it hold an A+ rating from the Better Business Bureau, but it’s also insured by the FDIC.

Additionally, the CFPB does not currently have any complaints filed against it.

As far as customer satisfaction, many loan holders on different rating forums have posted positive reviews. You also don’t have to provide highly detailed information to get their mortgage rates when you apply. Magnolia Bank also offers a $1,000 Best Rate Guarantee on its mortgages.

Overall, Magnolia Bank’s practices and loan application process is streamlined, simple, and convenient.

The one notable downside with their loan application process is that some customers may not feel comfortable using an online platform for financial matters like this.

However, you can rest assured that Magnolia Bank is safe, reliable, and well-regarded when it comes to offering competitive mortgage rates.

better.com mortgage logo

Better.com Mortgage Review

Before the digital revolution, the mortgage process was a face to face business. Customers had to sit down with a loan officer and handwrite mortgage applications before entering an extensive consultation regarding yet even more paperwork.

In the last 20 years, however, more lenders have transitioned to an online mortgage loan process. The result?

Today’s mortgage experience is entirely online, including the loan application process. All loan types, including first-time homebuyers and refinancing–all see a loan officer only at closing.

Better.com Mortgage is one online lender that prides itself on customer’s online experience with the entire online process.

Table of Contents:

  • About Better.com Mortgage
  • Loan Options
  • Qualification Process
  • Pros & Cons

Who Owns Better.com Mortgage?

better.com mortgage logo

When looking at boutique mortgage companies, it’s essential to do some research to determine their financial viability.

Many of the best mortgage companies that previously did brisk business crumbled in the aftermath of the 2008 mortgage crisis. So, you would do well to find out who is writing the checks for your chosen mortgage company.

In this case, Better.com mortgage is listed as privately owned, which may concern some. That said, some highly prominent financial institutions, such as Goldman Sachs, back Better.com, and the company has done a fabulous job cornering the market on low rates and rapid closing with a personal touch.

They have been awarded the following NMLS ID#330511 (enabling you to verify their legal lending ability verification) and can be found at 120 Broadway, 5th Floor, New York, NY 10271.

Better.com mortgage operates almost entirely online, including the loan estimate and online application process.

This level of automation means customers gain honest rate quotes, apply, gain a pre-approval, and send verifying documents through an online portal, from which an underwriter will review it quickly.

ut Better.com also provides you with direct access to a loan officer as you go through the application process, delivering that personal touch in navigating your mortgage.

Interestingly, Better.com states that their loan officers don’t make a commission for closed sales. This unorthodox approach is quite different from most mortgage lenders who frequently roll loan officer origination fees into closing costs, which incentivize closing more than service.

Loan officers at Better.com are strictly there for support, meaning you’ll have someone dedicated more to helping customers than ensuring loan closure.

To get started, it is as easy as visiting the Better.com website and choosing which mortgage options suit your needs:

Learn More

Loan options with Better.com Mortgage

Because of the streamlined and primarily digital submission system as a direct lender, Better.com offers a limited number of mortgage products including conventional loans.

There are no options for Home Equity Lines of Credit (HELOC). Because of COVID, Better.com has temporarily suspended FHA home loans, which may really impact first time home buyers.

Nor does the company provide the standard options for lower down-payment mortgages through government programs like the Veterans Administration (VA) or the U.S. Department of Agriculture (USDA).

Better.com does, however, offer lower down payment loans through its own fixed-rate program, and the company advertises that it works with borrowers who don’t have the standard 20 percent down payment.

Oftentimes they offer lower rates equalling lower monthly payments. According to its promotional materials, 72% of Better.com borrowers put less than 20 percent down on their home mortgages.

Conventional Fixed-Rate

Better.com offers standard fixed-rate loans and refinance mortgages, with terms of 15, 20, or 30 years.

These mortgage options have a fixed interest rate for the life of the loan and conform to Fannie Mae and Freddie Mac standards.

What’s more, Better.com collects no lender fees at closing.

Better.com advertises that they guarantee to be at least $1,000 lower on closing costs than any other lender, or they will give you $1,000.

It’s a pretty bold statement considering most lenders make their money and commissions through closing costs and fees.

Adjustable-Rate Mortgage (ARM)

These mortgage products allow borrowers to access higher-value homes and qualify for bigger loans at a lower initial interest rate than conventional fixed-rate products.

ARMs fix the interest rate for an initial period, after which it can fluctuate with the prevailing rate.

Jumbo Loans

Jumbo loans are more substantial than average conventional purchase or refinance loans and often have more stringent qualifications than standard fixed-rate mortgages.

Better.com is unique in that it offers Jumbo loan programs with 10 percent down payments, which ordinarily would incur a penalty of monthly mortgage insurance.

Better.com offers these products without mortgage insurance for qualified borrowers.

FHA

Another lower-down-payment product for which borrowers might qualify is an FHA loan, which is guaranteed by the Federal Housing Administration.

FHA loans are among the few federally backed programs that Better.com offers.

Further, the company actively advertises its willingness to work with customers using alternative income and lower down payments.

However, Better.com has temporarily suspended all FHA loans during the COVID pandemic.

Learn More

Qualification Process with Better.com

Better.com qualifies its customers similarly to most mortgage companies, with a few significant differences that make them a little unique.

ONLINE QUESTIONNAIRE

Rather than filling out an application, Better.com offers an online questionnaire that walks you step-by-step through the submission process.

The questionnaire is dynamic. It changes and refines itself based on the answers you provide, thus tailoring it to your specific situation.

SOFT CREDIT PULL

They will do a soft pull on your credit report, leaving your credit score intact, but giving them an idea of what type of borrower you may be.

Better.com requires a FICO credit score of at least 620 to qualify for any loan type.

PREQUALIFICATION LOAN OPTIONS

A few minutes after starting the process, you will have your first prequalification, with options for your loan. You can even lock in your rate without incurring an additional fee, which is unusual for a major mortgage lender.

CONNECT WITH A LOAN OFFICER

During the submission process, Better.com will connect you with a loan officer. This loan officer isn’t there to make a commission off of you.

Instead, the purpose is to give you a point of contact with your lender to help guide you through the verification process.

If you have alternative income from unusual payment methods, like gig jobs, the loan officer can take that into account during qualification.

Better.com also boasts that it can close a loan within 21 days, which is quite an achievement. Its sleek online approach, combined with the personal assistance of a loan officer, makes this claim very believable.

Pros and Cons

Pros

  • No Commissions: Most lenders make their money off closing costs and commissions. Better.com offers you $1,000 if their closing costs aren’t $1,000 less than their competitors.
  • Online but Personal:com provides an integrated approach that welds technological advancement with excellent customer service. There are no annoying, constant phone calls to worry about.
  • 10-percent-down Jumbo Loans with No Mortgage Insurance: Most other lenders would require expensive monthly mortgage insurance.

Cons

  • No Home Equity Line of Credit: HELOCs are excellent programs for home-renovation products. They’re flexible and useful for unexpected construction expenses.

Is Better.com Best for You?

Better.com has integrated human interaction with a highly technological process to supply its customers with versatility and personal customer service.

Unfortunately, however, Better.com doesn’t offer some of the mortgage loan products that customers have come to expect from a full-service boutique mortgage lender, including home equity loans, FHA, VA loans, or USDA loans.

So depending on your mortgage needs, Better.com may or may not be the best option for you.

new american funding

New American Funding Review

After the economic mortgage crisis aftermath of 2008, lenders have re-evaluated the whole process, sticking to a set of universal rules for many different loan types and loan amounts.

Of course, nobody expects lenders to offer the super-risky mortgage packages again.

But, it can be helpful to find a lender willing to explore alternative forms of credit and verification, especially if you’re self-employed and need to look at different loan options.

Regardless of your standing, the home loan application process can be grueling.

Let’s dive in to this New American Funding mortgage review and see just how they measure up with homeowners searching for competitive rates.

Table of Contents:

  • About
  • Mortgage Options
  • Qualifications
  • Pros & Cons
  • Contact Information

About New American Funding

new american fundingNew American Funding (NAF) is a family-owned lender created in 2003 in Orange County, California by Rick and Patty Arvielo that has grown into a $14 billion dollar lender.

They are set apart by their traditional manual underwriting, allowing your loan officer to explore alternative credit more thoroughly than the standard computer models that much of the industry uses.

And New American offers a wide variety of excellent mortgage products to fit almost any needs, except for any loan applicants who reside in New York or Hawaii.

New American Funding Mortgage Options

New American offers a wide variety of mortgage products fit for almost any borrower’s unique situation. Here’s a quick list of all the available loan options:

  • FHA Loans
  • Refinancing loans including cash-out refi’s
  • VA Loans
  • ​Conventional Loan
  • Reverse Mortgage Loan
  • ARM loans
  • 15 and 30 Year Fixed Rate Mortgages
  • I CAN Mortgages

Whether you’re looking for a conventional fixed-rate mortgage with a regular term as a first time home buyer, or a home equity line of credit for a new home-renovation product, New American Funding likely has a product with competitive mortgage rates that will work.

They take into account your monthly income and expenses (think credit cards and such), credit reports, and savings before starting the process.

It also hosts several programs designed to assist customers who don’t have the typical 20 percent down payment that most mortgage providers demand.

They do require a relatively solid FICO credit score of 700 to qualify, however, they only require 3% down on most loans. NAF also offers a mortgage calculator on their site, allowing you to estimate what your future payment may be.

They offer online convenience for buyers, including a pre-qualification process, however, to complete the loan you will need to speak to a representative and have a loan officer assigned to your file.

Conventional Fixed Rate

The fixed-rate loan is the standard of most mortgage programs. Terms run from 10 to 30 years, with a rigid interest rate that remains the same throughout the course of your loan.

A conventional fixed-rate loan is what most people think of when they think of a mortgage, and it usually requires several formal verifications to close.

Adjustable-Rate Mortgage (ARM)

ARM loans offer customers a low starting interest rate that can increase periodically over time. These loans serve up an excellent option for people who intend to refinance to a fixed rate before the interest adjusts.

ARM loans usually start with a lower interest rate, allowing a borrower to get into a home they might not be able to afford otherwise. This type of loan is perfect for people who are working on improving their financial situations, allowing them to prove their ability to pay on time, then refinance.

Jumbo Loans

Jumbo Loans are loans with a more sizeable total balance than conventional loans. They’re designed primarily for customers with a higher income who need a more substantial loan to secure their property.

They often come with much stricter requirements to verify and underwrite due to the more significant risk on the bank’s behalf.

Reduced Down Payment Options

New American Funding offers a variety of traditional reduced down-payment mortgage options, including the following loan programs:

  • VA (Veterans Administration)
  • FHA (Federal Housing Administration)
  • USDA (U.S. Department of Agriculture)

These programs help buyers get into houses with a lower down payment than typically required. New American works with these agencies, but also offers help to borrowers looking for state and local assistance with their down payments.

Home Equity Line of Credit (HELOC)

Like many other mortgage lenders, New American Funding offers Home Equity loans. HELOCs are loan programs that create a pool of credit out of the equity you have in your house, a little like opening a checking account matching your home’s value.

They’re an excellent option for renovation projects with fluctuating costs, as you withdraw funds to pay for renovation stages throughout the process.

Reverse Mortgages

One unique product that New American offers that you won’t see everywhere else is the Reverse Mortgage. Like the HELOC, Reverse mortgages use the equity of your home to give you a monthly payment out of the value of your investment.

These products are terrific for retirees, providing them with a monthly income from their property.

New American Funding Qualifications

Many mortgage lenders use an automated underwriting process to verify financial information and determine whether a prospective borrower qualifies for a particular loan.

This automation can streamline the process and make it much faster to close, but it can also inject some rigidity into the process. Some customers may be able to present documentation that falls outside of the capabilities of the automated underwriting systems.

New American carries out all of its underwritings manually, so a person – not a computer – will review your documentation personally. A manual underwrite gives the lender flexibility that automated systems don’t offer. Prospective borrowers may be able to qualify based on alternative information.

Other than the manual underwriting, most of New American’s requirements don’t deviate from standard mortgage qualifications. Customers will still need a down payment, income verification, credit score approval, and documentation to support their initial application. And they can submit their documents online, which makes the process quicker.

New American Funding representatives say they close the majority of their loans within 30 days. What’s more, they don’t charge a fee for an interest-rate lock, which is an attractive feature if you’re trying to take advantage of a specific rate before it fluctuates with the market.

Getting started is as easy as visiting the New American Funding website and choosing which mortgage option is right for you.

Pros and Cons

Pros

  • Online Document Portal: New American has a single portal for submitting documentation and checking rates, which streamlines the underwriting process.
  • Manual Underwrite: Personal underwriters can review alternative documentation for income and employment verification.
  • Many offered products: New American provides a wide assortment of loan programs, more than some better-known lenders with market competitive closing costs

Cons

  • Availability: New American Funding is available in every state except New York and Hawaii
  • ​Fees: They can be vague in regard to their origination fees. Make sure you pull up their disclosures page and read the fine print.

New American Funding Contact Information

Here’s a quick list of all their contact information:

  • Address: 14511 Myford Road, Suite 100, Tustin, CA 92780
  • Phone Number: (877) 826-4428
  • Website: https://www.newamericanfunding.com
  • NMLS #: ID#6606
  • BBB Rating: A+ accreditation

Is New American Funding Best For You?

New American Funding was founded in 2003, five years before the mortgage crisis.

Where many other lenders collapsed in the aftermath of that debacle, New American survived by remaining disciplined and conscientious throughout.

The fact that the company is still operating more than a decade later indicates that New American values good practices and is fit to weather the fickle mortgage market.

New American’s willingness and adherence to manual underwriting is another nice perk of its business practices.

It might take slightly longer to close, but it affords customers flexibility within their documentation.

New American also offers services and applications in both English and Spanish, opening the market to more customers, including ones who are otherwise underserved in the housing market.

These language services show commitment to customer service that is sometimes lacking with larger lenders.

chase bank logo

Chase Mortgage Review

Chances are you’ve heard of Chase Mortgage. It’s been one of the most popular mortgage companies in the country for years, with satisfied customers spread throughout the United States.

Chase mortgage not only weathered the travails of the 2008 mortgage crisis but has come through with accolades and a robust portfolio of successful practices.

The company offers a wide variety of versatile mortgage products, from conventional fixed-rate mortgages to home equity lines of credit.

What’s more, Chase has streamlined its application process so you can easily manage your underwriting documents online.

Table of Contents:

  • Is Chase Good for Mortgages?
  • Chase Mortgage Options
  • Qualifications
  • How Long Does it Take Chase to Close a Mortgage?
  • Pros & Cons of Chase Mortgage

Is Chase Good for Mortgages?

chase bank logoIt’s challenging to define a “good” mortgage company because each customer has a unique perspective, based on individual needs and situations.

If someone gets denied for a mortgage, for example, they might connote the company with a “bad” business. When it comes to banks, though, denying a loan indicates a healthy level of protection for customers’ and shareholders’ best interests. That’s “good” business.

And Chase is good for mortgages, indeed. It offers a wide variety of mortgage products to satisfy almost anybody’s needs. It’s also been around longer than many other mortgage companies, and it’s been successful in shedding the crisis of 2008 with little ado.

Chase Mortgage also benefits from its willingness to embrace technology in the mortgage industry, while still maintaining a personal connection with its customers.

When you’re applying for a mortgage, you can submit all of your pertinent documents electronically through the Chase portal, delivering them directly to your underwriter and loan processor with no delay. This technology shortens loan-turnaround times dramatically.

Chase Mortgage Options

If you have some idea of the type of mortgage you’re looking for, Chase Mortgage likely provides it.

The company has dozens of loan packages available, from conventional fixed rates to FHA and VA loans, which reduce the amount you need for a down payment.

Here’s a breakdown of the mortgage products Chase currently offers:

Conventional Fixed Rate

Chase mortgage offers 10-, 15-, 20-, 25-, and 30-year fixed-rate loans.

These are your standard mortgages, featuring a fixed interest rate and reasonable lending guidelines, including income verification, credit approval, and equitable down payments.

ARM Loans

Adjustable-rate mortgages (ARMs) are currently a good option if you’re looking for a short-term mortgage with the potential to refinance down the road.

ARM loans have seen their share of bad press since the mortgage crisis, but there are reasons companies like Chase still offer them. Check with your mortgage banker for options and details.

Jumbo Loans

Jumbo loans are generally larger mortgages than you’ll typically find as fixed-rate loans and have generally stricter approval requirements.

Chase offers Jumbo mortgages of as much as $3 million, so you can get some serious buying power if you qualify.

Home Equity Line of Credit (HELOC)

Home equity loans are a fantastic way to fund extensive repairs or renovations on your home. These loans allow you to withdraw cash – just as you would from a personal bank account – for expenses associated with significant construction projects.

For a fee, Chase mortgage offers you the ability to lock in your interest rate during the draw period, so you can finish your renovation project before worrying about any rate changes.

Reduced Down Payment Options

Chase mortgage offers conventional loans with low down payments, including FHA (Federal Housing Administration) and VA (Veterans Administration) loans.

In fact, for these loans, your down payment will only have to represent 3 percent of your total mortgage.

Chase also offers two additional loan programs of their own:

  • Standard Agency is a mortgage program for borrowers with a credit score of 640 or higher. Like FHA and VA loans, it also allows for a 3 percent down payment but requires that the borrower carry flood insurance regardless of whether the property is in a flood zone or would ordinarily require it.
  • Chase’s DreaMaker program also allows a 3 percent down payment but is for borrowers who don’t meet credit requirements and are looking to borrow in low- to middle-income areas or refinance an owner-occupied home. Qualifying requires borrowers to complete a home buyer education course.

Learn More

Chase Mortgage Qualifications

Chase maintains qualification requirements that are relatively standard among mortgage companies. Borrowers must submit an application that Chase uses to pre-qualify people for a mortgage product. This prequalification is the basis for all documentation required for underwriting and closing your loan.

As with any mortgage application, expect to provide income verification, current pay stubs, income-tax filings, and information required for credit approval. Your Chase mortgage banker will let you know what documentation you need to close.

Chase provides a convenient online portal for you to submit paperwork directly to its loan processors and underwriters. This streamlined process will save you time – and file space!

Get started with Chase Mortgage now by using their convenient online portal!

How Long Does it Take Chase to Close a Mortgage?

Chase Mortgage promises to make the entire mortgage process as quick and painless for you as possible. In many other mortgage-applications systems, it can take weeks to process the necessary documentation for a loan, and even longer for underwriters to review it, depending on their workload.

Chase offers to turn around all paperwork and make a final decision quickly, which it facilitates by operating an online documentation portal through which you submit verification digitally.

Underwriters can review and approve documents directly through the integrated platform. This unified approach allows Chase to promise you $1,000 in cash if your new mortgage isn’t processed and closed within 21 days from submitting the first application.

Pros and Cons of Chase Mortgage

Pros:

  • Electronic application and document submission and tracking streamline the underwriting process for a faster closing.
  • Discounts for Chase Bank customers: If you’re an existing Chase customer, you may be eligible for discounted fees and deals.
  • Variety of products: Chase offers a wide range of mortgage products, including conventional fixed-rate, ARM loans, Jumbo, and HELOC loans.

Cons

  • All chase mortgage products require contact with a mortgage banker. This doubles as an advantage, as it provides a point of contact during the underwriting process.
  • Chase Mortgage charges underwriting, origination, and rate-lock fees, which other lenders often waive at closing or as an incentive for your business.