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Here’s another PR nightmare…

Wells Fargo reportedly offered a struggling homeowner a loan modification that resulted in just $2 off his monthly mortgage payment, according to an ABC news affiliate.

The Independence, Ohio-based homeowner, Mike Elewski, apparently got into trouble back in 2009 when the ongoing recession began to affect his business.

In August of 2009, he asked the San Francisco-based bank and mortgage lender to grant him a loan modification, but bank representatives said they only negotiate with homeowners behind on mortgage payments.

As a result, Elewski stopped making his mortgage payments, and before long, faced foreclosure.

Eventually a judge ordered mediation between him and Wells Fargo, and after mountains of paperwork and thousands in attorney fees, the bank offered him a modification.

Unfortunately, the loan mod resulted in just $2 off his regular mortgage payment, meaning foreclosure is likely imminent.

But alas, because the story is gaining steam, Wells will likely have to step in and give the man a better deal.

This seems to be the trend nowadays, make noise and get help.

A Wells spokesman did tell the publication it would never tell customers to miss payments, and noted that it was continuing to work with the customer to identify solutions that would allow him to retain his home.

Per the article, the Ohio attorney general’s office has already received 450 complaints involving mortgages since the beginning of the year.

(photo: wwarby)

Source: thetruthaboutmortgage.com

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Today we’ll check out tech-minded lender “GO Mortgage,” which is a dba of GSF Mortgage Corporation.

While GO is only a few short years old, its parent company GSF has been around since 1995. And its founders have been in the mortgage biz since the 1970s.

So clearly there’s a strong pedigree here, and the combination of the latest technology coupled with old-fashioned customer service could be a win for consumers.

Let’s learn more about GO Mortgage to determine if it could be a go-to spot for your home loan needs.

GO Mortgage Fast Facts

  • Independent direct-to-consumer mortgage lender
  • A dba of parent company GSF Mortgage Corp.
  • Founded in 2018, headquartered in Brookfield, Wisconsin
  • Offers home purchase loans, refinances, and construction loans
  • Currently licensed in 36 states nationwide
  • Funded roughly $1.3 billion in home loans last year

GO Mortgage is an independent, direct-to-consumer mortgage lender that offers home purchase financing, refinances, and construction loans.

The company was founded in 2018 and is headquartered in Brookfield, Wisconsin, the state where they do the bulk of their business.

In fact, nearly 25% of total loan volume came from the Badger State, though they’re also quite active in Texas, Florida, North Carolina, and Virginia.

Overall, they managed to fund about $1.3 billion in home loans last year, with about half of that coming from refinance transactions, a third from home purchases, and the rest home improvement.

Currently, they work remotely with customers in 36 states nationwide as they don’t appear to have physical branches.

They aren’t available in Alaska, Connecticut, Hawaii, Massachusetts, Montana, Nebraska, New Hampshire, New Mexico, New York, North Dakota, Rhode Island, Vermont, West Virginia, or Wyoming.

How to Apply with GO Mortgage

  • Their ‘On the GO’ digital app is powered by fintech company SimpleNexus
  • Allows customers to apply for a mortgage from any device in just minutes
  • Ability to link financial accounts, securely scan/upload docs, and eSign disclosures
  • Use the borrower portal to check your progress and receive status updates along the way

To get started, simply navigate to the GO Mortgage website and hit “Get Rates.” Or simply call them up directly to get connected with a loan officer.

If you already know who you’ll be working with, you can search by name once you click “Find an Advisor.”

Those who are ready to go can click “Apply Now” and begin filling out the digital application powered by SimpleNexus.

There’s also a smartphone app called “On the GO” if you prefer to manage your mortgage experience from your mobile device.

Once in the app, it’s possible to link financial accounts, securely scan and upload docs from your phone, and message your loan officer instantly when you have questions.

You’ll also get updates as you go and there’s an online borrower portal where you can check your loan status.

If you’re looking to get pre-approved for a mortgage, they say you can do so in about 24 hours.

They appear to employ the latest tech, but also have dedicated loan officers and processors standing by to help when needed.

Loan Programs Available at GO Mortgage

  • Home purchase loans
  • Home renovation loans
  • Refinance loans: rate and term, cash out, and streamline
  • Conventional mortgages
  • Jumbo loans
  • FHA/VA/USDA loans
  • Single-close construction loans

Go Mortgage has a fairly extensive product menu, offering anything from a home purchase loan to a mortgage refinance to a renovation or construction loan.

You can also get your hands on any major type of loan, whether it’s a conventional loan backed by Fannie Mae, a jumbo loan, or a USDA loan.

They seem to specialize in single-close construction loans, with options for all major loan types including Fannie Mae, FHA, VA, and USDA.

Both fixed-rate and adjustable-rate mortgages are available in a variety of loan terms, including options like the 15-year fixed and 5/1 ARM.

GO Mortgage Rates

While GO Mortgage says many of its customers choose them for their low rates, they don’t feature on their homepage or elsewhere on their website.

As such, you’ll either need to fill out their mortgage rate quote form online, or simply call them up to get connected with a licensed loan officer.

I was able to find at least one loan advisor that listed sample daily mortgage rates on his personal webpage, but most did not.

From what I did see, the mortgage rates were definitely competitive, but it will depend on the loan scenario.

In terms of lender fees, I couldn’t find any information regarding a possible loan origination fee, processing, underwriting, etc.

So be sure to take the time to speak with someone first to get all those details, then shop around accordingly.

My assumption is they’re competitively priced with other nonbank, direct lenders, which might put them ahead of big banks, but perhaps not the absolute lowest out there.

But again, you’ll need to get in touch with a human to find out.

GO Mortgage Reviews

One thing Go Mortgage isn’t short on is excellent reviews.

On Experience.com, they’ve got a 4.79-star rating out of 5 from more than 7,000 customer reviews.

Be sure to check out individual loan officer reviews as well if you want to fine-tune your search and work with someone truly exceptional.

Over at Zillow, GO Mortgage has a stellar 4.88-star rating out of 5 from about 1,000 customer reviews.

They also have an equally strong 4.9-star rating on Bankrate, and a 4.7-star rating on Google from about 250 reviews.
The company is an accredited business with the Better Business Bureau, and currently holds an ‘A+’ rating with the BBB based on complaint history.

To sum things up, GO Mortgage appears to be a popular choice for both home buyers and those looking to refinance.

And as noted, they specialize in one-time construction loans, so they could be a good option if you’re building a home.

GO Mortgage Pros and Cons

The Pros

  • A paperless, digital mortgage loan process
  • Can apply online or via smartphone in minutes
  • Lots of loan programs to choose from
  • Specialize in one-time close construction loans
  • Excellent customer reviews across all ratings sites
  • A+ BBB rating, accredited business
  • Appear to service their own loans
  • Free biweekly mortgage payments
  • Free mortgage calculators on their website

The Cons

  • Do not list mortgage rates or lender fees online
  • No physical branch locations
  • Not available in all states

Source: thetruthaboutmortgage.com

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The nation’s largest mortgage lender, Wells Fargo, is now offering mortgages to home buyers with just 3% down via their new “yourFirst Mortgage.”

I’m assuming the new loan program is based on Fannie and Freddie’s 97% LTV program announced back in late 2014. And it appears to be geared toward first-time home buyers seeing that the name is yourFirst Mortgage.

That reads as your first mortgage, meaning your first home purchase as well.

The program is available for qualified first-time buyers, including low-to-moderate income applicants as well as the “diverse Millennial population,” which Wells points out is over two-thirds of first-timers these days.

I believe anyone who can demonstrate their ability to repay the loan can qualify for a yourFirst Mortgage if they haven’t owned a home in the past three years, or if at least one borrower on the loan hasn’t.

yourFirst Mortgage Only Requires 3% Down

  • Wells Fargo’s new 3% down home loan program
  • No median area income limits
  • Down payment assistance and gift funds permitted
  • Only loan option is a fixed-rate mortgage

The main selling point to this new mortgage is the 3% down payment requirement, which rivals the 3.5% down required from the FHA.

To make the deal even sweeter, and perhaps riskier if you like, your down payment and closing costs can come in the form of a gift or from a down payment assistance program.

In other words, you don’t need any cash to qualify, other than maybe some reserves to show you can make monthly payments going forward.

To offset this perceived risk, Wells Fargo is offering a 0.125% interest rate reduction if home buyers complete a homebuyer education course conducted by a certified HUD-approved housing counselor. So instead of a rate of 4.5%, you might get a rate of 4.375%.

Your down payment must be less than 10% to qualify for the rate discount.

You might also learn something about mortgages and homeownership, which could prevent default and/or foreclosure in the future.

yourFirst Mortgage Allows Household Income, Non-Traditional Credit

  • Flexible underwriting allows for household income
  • Including renters and non-borrowing family members
  • And non-traditional credit that might not show up on a credit report
  • Requires PMI but might be able to get lender-paid in exchange for higher interest rate

Playing on the risky theme, the yourFirst Mortgage allows both household income and non-traditional credit.

So if you eschewed credit for much of your life, like some Millennials appear to do, you can still get approved for a mortgage via this program because everyday bills like tuition, rent, and utilities may be used in place of traditional credit tradelines.

Additionally, you’re able to use income from other occupants in the home (that aren’t co-borrowers), including family members and renters, to qualify for the loan.

But rest assured the loans will be “fully documented and underwritten,” so no new housing crisis here…

It appears that Wells Fargo is working with Self-Help, the company that helped launch Bank of America’s 3% down mortgage back in February of this year, known as the Affordable Loan Solution.

The yourFirst Mortgage does require private mortgage insurance because you’re putting less than 20% down. However, it might be built into the rate or lender paid.

I took a look at Wells Fargo’s rates today and they were advertising 3.75% on a 30-year fixed with borrower-paid mortgage insurance, and 4.375% with LPMI.

yourFirst Mortgage Features

  • 3% down payment requirement
  • Down payment and closing costs can be gifted
  • Down payment assistance permitted
  • Property must be owner-occupied (I believe only single unit qualifies)
  • Loan is fully documented and underwritten
  • No income limits
  • Income from others in the household may be used to qualify
  • Loan type is 30-year fixed
  • Mortgage insurance required (can be lender-paid)
  • Minimum FICO most likely 620
  • Non-traditional credit may be used (utility bills, tuition payments, etc.)
  • 0.125% interest rate discount for completing homebuyer education course

Source: thetruthaboutmortgage.com


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Source: mint.intuit.com

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PRMG has strengthened its reverse mortgage team with the addition of Ellen Skaggs (pictured), who is joining as HECM divisional manager. Skaggs’ appointment, according to the wholesale mortgage lender, expands its reach and impact in the reverse mortgage industry and helps more seniors benefit from this powerful financial product. In her new role, Skaggs will … [Read more…]

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[UPDATED, 2021]

Pay Private Mortgage Insurance (PMI) or play the wait-and-save game? That’s the dilemma for a majority of would-be homebuyers. It’s rarely an easy (or fun) choice.

The Dilemma

Coming up with a 20% down payment can take years. With home prices increasing 5-10% annually, the home of your dreams is sure to cost quite a bit more in 2026. Rather than save, some homebuyers opt to pay PMI instead. Most future homeowners don’t know what PMI is and how much it may cost them.

What’s the Purpose of PMI?

Usually you purchase insurance to protect yourself. PMI works differently: basically you pay to protect the mortgage lender in the event you can’t pay the mortgage. It’s basically a mortgage lender’s insurance to protect themselves if a borrower stops making payments.

In general, mortgage lenders consider buyers who put at least 20% down to have enough skin in the game that they’re low risk. That makes everyone that puts down less than 20% a riskier investment, so they require them to pay PMI.

The Upside of PMI

The good news about PMI is that it’s not too expensive and you don’t pay it forever. Your lender typically requires you to pay PMI until you get to a Loan-to-Value (LTV) ratio of 80% loan to 20% equity. Once you do, you can request your PMI be cancelled, unless you’ve taken out a FHA loan (PMI never falls off when you choose this loan type). PMI also doesn’t cost too much, although the amount you pay can vary. Below are a few ways to lower your payment.

Commonly Asked PMI Questions

How much will I pay in PMI?

Homebuyers required to pay PMI typically pay around 0.5% annually of the total amount borrowed, with the cost split across all 12 months. Here’s some examples:

  • $180,000 loan ($200,000 with 10% down), PMI $75/mo
  • $285,000 loan ($300,000 loan with 5% down), PMI $125/mo

When will I be done paying PMI?

This depends on what type of loan you take out. Here’s a quick guide:

  • FHA: If you take out an FHA loan, mortgage insurance continues for the life of the loan. Ouch. You’d have to refinance your loan to get rid of it.
  • Conventional: On a conventional loan you only pay PMI until your equity reaches 20%.

How can I avoid paying PMI entirely?

Your house is probably your biggest expense, and the thought of spending extra money each month is as appealing as week-old sushi. Do you have to pay PMI? No, not if you do any of the following:

  • Put 20% down. Call the parents, check in with Grandma, collect every debt from your former roommates. When you put 20% down, you don’t pay PMI at all.
  • Opt for an 80-20 piggyback loan. 80-20 mortgage is paid through two loans, a first and a second mortgage. The 80 first mortgage covers the home loan; the 20 second mortgage is the down payment. The second loan in a piggyback loan usually has a higher interest rate.
  • Look for owner financing. In some situations, owner financing works like rent-to-own, in which case you probably won’t be required to pay 20% down or PMI.
  • Shop for homes at a lower price point. Consider the difference in down payment for a $250,000 home versus a $300,000 home: (we’ll save you the math: it’s $10,000). Lower price homes may fit your savings account better—and you can trade up or add on later.
  • Check out Homie Loans™. Homie Loans™ can look at your personal financial situation and tell how you can lower your PMI. Homie Loans™ may be able to help you with a new loan.

To Pay or Not to Pay? The Decision is Yours

No one wants to pay extra each month for their home, but if paying PMI means you can buy a $300,000 home now vs. waiting five years while you save, paying a few thousand in PMI over that same period can make a lot of financial sense. Plus, the $300,000 home you purchase now starts building equity ASAP and will likely increase in value each year you live there.

We’re Here to Help

There’s a lot to consider when choosing to pay PMI vs. wait and save for a 20% down payment, but we hope we’ve given some helpful tips to guide you in the right direction. If you have any additional questions, or would like to begin the home buying process, click here to learn more about how to get started. We’d be happy to help you start your search for your dream home!

Source: homie.com

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Wells Fargo, which has been the top residential mortgage lender for five consecutive quarters, offers several incentives to those who choose to close their mortgage with the bank.

One such program is the “Wells Fargo Closing Guarantee,” which is essentially a promise they’ll close your loan on or before the closing date stated in your original purchase contract.

After all, you won’t want to sleep in a hotel, or worse, the moving truck…

But if, for some reason, Wells Fargo is unable to close on or before that date, you’ll get a check equal to your first month’s principal-and-interest mortgage payment.

Not a bad deal, right?

Well, there is some fine print you should be aware of.

First, you must provide Wells Fargo with a copy of the original purchase contract and all required documentation within 48 hours of submitting a complete loan application.

Additionally, the loan must be locked and all loan requirements and conditions must be met at least 10 business days prior to the set closing date.

The guarantee is not valid if you change loan programs or terms, if you don’t specify a closing date, move up the closing date, miss the closing date on your own actions (or a third party’s) or due to inclement weather, if applicable law or investor requirements impose a required waiting period prior to closing, or if you commit fraud.

The Wells Fargo Closing Guarantee is only good for purchase money mortgages (including purchase money home equity lines of credit), and excludes refinance loans, non-purchase money second mortgages, and mortgage broker-originated loans.

Wells Fargo & Company employees, along with their family members, are not eligible.

Assuming you qualify, you must continue to make mortgage payments (don’t assume they’ll pay it)!

Finally, the Wells Fargo Closing Guarantee may be reported to the IRS on a Form 1099-MISC, so you will likely be taxed on it as well.

The Verdict

It’s certainly not a bad deal if Wells Fargo happens to be providing you with the lowest mortgage rate and set of terms.

But it’s certainly not a reason to choose Wells Fargo over another lender that may be providing a lower rate and better terms.

And it sounds like something has to go horribly wrong for the guarantee to actually be paid out, especially with all the requirements that must be met.

So be sure to shop around and obtain several mortgage rate quotes before committing to one lender.

Tip: How to get the best mortgage rate?

Source: thetruthaboutmortgage.com

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Yep, it’s another post about a 1% down home loan, which seems to be the next big thing in the mortgage realm. That and zero down mortgages I suppose. I guess it’s a sign of the times, or more appropriately, sky-high home prices.

But this new loan program from United Wholesale Mortgage is a tad different. It’s unique because it’s being offered by one of the largest wholesale lenders, meaning mortgage brokers now have a 1% down mortgage option to extend to their borrowers.

It’s a game changer for brokers because up until now they’ve had to compete with loan officers at retail banks who had access to more low and no-down payment loan programs. It levels the playing field to some degree.

United Wholesale Mortgage Equity Boost with Just 1% Down

  • Borrowers only need to put down 1% of the home purchase price
  • United Wholesale Mortgage contributes another 2%
  • Which when combined results in a 3% down payment
  • Enough to get a conventional mortgage loan backed by Fannie Mae or Freddie Mac

Like some of the other recent 1% down offerings, such as the program offered by Guaranteed Rate, the lender covers a portion of the down payment so the borrower can come into the home purchase with very little down but still walk away with some built-in equity.

It’s good to have some skin in the game, especially if home prices flatten out, and this program seems to accomplish that.

Specifically, the borrower must come up with a 1% down payment and United Wholesale Mortgage will chip in (gift) 2% of the home purchase price, pushing the loan-to-value ratio down to 97%, making it eligible for Fannie Mae or Freddie Mac backing.

It’s unclear if they’re working with Fannie Mae or Freddie Mac here, but it appears to be a conforming loan, which generally equates to lower mortgage interest rates.

United Wholesale Mortgage calls the loan program “Conventional 1% Down with Equity Boost,” an exclusive only offered by the Troy, Michigan based mortgage lender.

They’ve reportedly grown to become the top wholesale mortgage lender in the nation so it makes sense they’d be the first to come up with such an offering.

There Are Some Rules Here…

  • United Wholesale Mortgage requires a 700 FICO score for the program
  • Meaning only the most creditworthy borrowers need apply
  • The max DTI ratio is also set at 43% like most other mortgages
  • And it’s likely only available on an owner-occupied one-unit property with a conforming loan amount

There are some guidelines borrowers must adhere to if they want to get away with a 1% down payment on a new home.

First the foremost, you must have a minimum 700 FICO score. Additionally, the max DTI ratio is set at 43%, which is the standard for all Qualified Mortgages.

Other than that, it should follow the guidelines set forth by Fannie and Freddie. Take a look at the Home Possible Advantage for more on that.

Essentially, you can only finance an owner-occupied one-unit property, so basically a single-family home, condo, or townhouse.

The loan amount also has to be at or below the conforming loan limit, which is currently set at $453,100. I don’t believe you have to be a first-time home buyer, but you are limited in the type of mortgage you can get if it adheres to Fannie/Freddie. Just fixed mortgages, no ARMs.

I’m not sure about the rates, but United Wholesale Mortgage says on their website that they’re “great low rates.”

Lastly, homeowners may be able to forego monthly private mortgage insurance, though in that case it will be paid upfront or built into the interest rate. In other words, a higher mortgage rate but no MI paid out of pocket directly if that’s your desire.

Perhaps most exciting, UWM says they can close the loans in 30 days or less, which is a great selling point for someone attempting to purchase a home in today’s competitive real estate market.

They lend in all 50 states so the new loan program is presumably open to would-be homeowners nationwide. If you’re working with a mortgage broker, you may want to inquire about this option assuming they have a relationship with UWM.

If you’re a broker, reach out to UWM to get paired with one the company’s Account Executives to learn more about this program.

Source: thetruthaboutmortgage.com

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Today we’ll take a hard look at “Aurora Financial,” a direct mortgage lender that says it’s built for speed.

In fact, they claim it’s possible to close a home purchase loan or refinance in as little as 14 business days, which is well below the average time it takes to get a mortgage.

Typically, you’re looking at 30-45 days during normal market conditions, and even longer if the industry is slammed.

So if you’re in need of a quick close and a low mortgage rate, Aurora Financial could be a winner. Let’s learn more.

Aurora Financial Fast Facts

  • Direct-to-consumer mortgage lender
  • Offers home purchase loans and mortgage refinances
  • Founded in 2003, headquartered in McClean, VA
  • Currently licensed to do business in 20 states nationwide
  • Funded about half a billion in home loans last year
  • Specialize in very fast loan closings

Aurora Financial is a Virginia-based direct-to-consumer mortgage lender that offers home purchase loans and mortgage refinances.

They seem to focus on the latter, with such transactions accounting for around 90% of their total loan volume in 2020.

Speaking of, they closed nearly half a billion in home loans last year, with about half of overall volume originated in their home state of Virginia.

At the moment, they do business in the states of California, Colorado, Connecticut, Delaware, D.C., Florida, Georgia, Illinois, Massachusetts, Maryland, New Hampshire, New Jersey, North Carolina, Oregon, Pennsylvania, South Carolina, Texas, Virginia, Washington, and West Virginia.

While they work all over the country, you’ll likely be applying remotely as they don’t appear to have brick-and-mortar branches.

How to Apply with Aurora Financial

To get started, simply visit their website and click on “Apply Online.” You can also call them up directly before you do to get pricing.

From there, you’ll be prompted to create an account, then you can fill out the actual loan application.

They say it’s a digital process and mostly paperless, with e-signatures for initial disclosures and a secure portal for quick uploads of supporting documents.

Those looking to buy a home can generate a pre-approval in “minutes,” and their big claim is using the latest tech to offer the fastest closings in the industry.

Part of that might be their streamlined business model of focusing mainly on conventional refinance applications for W-2 borrowers.

It also helps that they offer both in-house paperless processing and underwriting.

Apparently, the average refinance closes in just 16 business days, though their rush closings can be even faster.

All in all, it should be easy to complete your application and get to the finish line, assuming you have a simple loan scenario.

Loan Programs Offered by Aurora Financial

  • Home purchase loans
  • Refinance loans
  • Conforming loans backed by Fannie Mae and Freddie Mac
  • High-limit and jumbo loans
  • FHA loans
  • VA loans

I wouldn’t say Aurora Financial has a vast product menu, but they do offer the most common programs that the majority of borrowers are looking for.

This includes home purchase financing, rate and term refinances, and cash out refis.

You can get a conforming loan, high-limit, jumbo, or government-backed option like an FHA or VA loan.

The only major loan type they don’t appear to offer is USDA loans.

It’s also unclear if you can get an adjustable-rate mortgage, not that they’re very popular at the moment.

Aurora Financial Mortgage Rates

One area where the company seems to shine is mortgage rates. Instead of simply telling you they offer super competitive rates, they post them right on their homepage.

You won’t have to dig around or provide your contact info first. Simply head to their website for daily rates.

They also advertise on third-party websites like Zillow, where lenders are often very competitive in the pricing department.

After all, you don’t want to be the most expensive option when listed among dozens of other lenders.

From what I saw, they were offering one of the lowest rates for a 30-year fixed on Zillow for a sample loan scenario I generated.

It was also listed with $1 in lender fees, which is essentially a no cost refinance. That means a low rate and equally low APR.

On top of their seemingly low rates, they also offer a free rate float down if you lock and rates get even better.

It only applies to conforming loans and the rate must drop by 50 basis points for a fixed-rate loan and 62.5 bps for an adjustable-rate mortgage.

As always, put in the time to gather additional quotes with competing lenders to ensure you do your due diligence.

Aurora Financial No Closing Cost Loyalty Program

Another perk to using Aurora Financial is their so-called “No Closing Cost Loyalty Program.”

Simply put, if you get a loan from them and mortgage rates drop enough to make a refinance worth it, they’ll offer one without closing costs.

Not only will they waive their own lender fees, but also third-party costs like the home appraisal, title and escrow.

Borrowers will only be responsible for funding their impound account, if applicable.

To qualify, the loan amount must $200,000 or greater, a conforming loan on a primary or second home, and be at least six months past the previous loan funding date.

This gives you the opportunity to refinance at no cost for the lifetime of your loan with them.

Aurora Financial On-Time Closing Guarantee

Pricing aside, Aurora Financial also offers an on-time closing guarantee to ensure you get your home purchase financing without delay.

This is especially important in a hot real estate market, which we’re currently experiencing.

In short, they’ll close your purchase transaction on time or credit you with $1,000 at the time of closing.

This offer only applies to conforming loans and FHA loans, with jumbo loans ineligible, along with self-employed borrowers.

Ultimately, you need a pretty cut and dry loan scenario to qualify, but the guarantee should apply to most borrowers who happen to file W-2 and have a conforming loan amount.

Aurora Financial Reviews

On Zillow, Aurora Financial enjoys a 4.69-star rating out of 5 from more than 700 customer reviews.

At Bankrate, they have a 4.8-star rating from nearly 300 reviews, with 97% of customers indicating they’d recommend this lender.

They also have a 4.8-star rating on Angi from about 80 verified reviews, with price, punctuality, and responsiveness all receiving high marks.

On Google, a very similar 4.7-star rating from about 125 reviews, and on Yelp a 4.5 rating from about 25 reviews.

The company is also A+ BBB rated, and has been an accredited company with the Better Business Bureau since 2006.

They have a 4.93/5 customer rating on the BBB website and no customer complaints on file.

In summary, Aurora Financial seems like a good pick for a homeowner with a vanilla mortgage (Fannie/Freddie W-2 borrower) that’s looking to refinance.

The combination of low rates and fees, coupled with fast processing and their no-cost loyalty program, separates them from other shops.

Aurora Financial Pros and Cons

The Good

  • Can apply online via their secure digital mortgage application
  • Offer a mostly paperless loan process and in-house processing
  • They post their daily mortgage rates online
  • Appear to offer low rates and limited/no lender fees
  • Free rate float down
  • Their loan officers don’t work on commission
  • $1,000 on-time closing guarantee
  • Can close loans super fast (in as little as 14 days)
  • Excellent customer reviews across all ratings sites
  • A+ BBB rating

The Perhaps Not

  • Only licensed in 20 states at the moment
  • May not offer USDA loans or ARMs
  • No branch locations

(photo: Eddie Yip)

Source: thetruthaboutmortgage.com

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Has your credit suffered a hit or two? Before you start thinking rentals, read this.

What mortgage lenders are looking for 

You know all about credit scores and that, across the three big credit reporting agencies, scores can really fluctuate. Mortgage brokers and lenders will look at your credit score, toss out the lowest and the highest and typically make decisions based on the score that’s smack in the middle.

But credit scores aren’t the only thing a mortgage lender considers. Other factors affecting loan qualification include:

  • Your income
  • Debt-to-income ratio 
  • How long it’s been since you missed a payment
  • How long you’ve been in your job 
  • Ratio of income and projected home payment

In other words, it’s a numbers game that goes way beyond your credit score.

And, if you’re buying with a partner, consider whether or not it’s best to have them on the loan.

If your co-buyer’s credit is crappy and yours is good, you may want to consider removing the co-buyer from the transaction. Realize, however, that the co-buyer’s salary won’t be factored in as income this way. Of course, the co-buyer is still welcome to live in the house with you.

Cleaning up your credit ASAP

Truthfully, there’s no way to change your credit score overnight. Cleaning up your credit, if it’s not too terrible, can take a few weeks at minimum. If it’s dreadful, expect to spend a few months (even up to a year) playing everything straight in order to get that number to inch a little higher. Fortunately, to purchase a home, you may not need to do either.

If your score is above 680, odds are good you’ll have no problem. If you’re looking at an FHA loan, 580 should do it (tip: you may get approved with a lower credit score for an FHA loan if you can put more than 3.5% down on your home). For comparison, the lowest possible credit score hovers around 300. FYI, if your score is in the 300s or 400s, you have work to do. Now is not the time to buy a home.

A lender will likely ask you to explain away all the dings on your credit report–for example, why you were late on a payment to your cable TV company (“I took the check to the post office but forgot to drop it in the mail and found it two months later, after disputing the past-due balance. It was paid in full on January 31.”), or why you failed to make a full payment to your car payment a few years back (“I had a large medical bill that I had to pay so I worked with my car loan company to move my February payment to the end of my loan instead.”) As long as you have a legitimate reason that shows why you paid late and that you didn’t walk away from the debt, this may be sufficient to clear up problems in order to obtain the mortgage. These don’t, however, change your credit score.

To really attack your credit score and give it a lift, start by getting a free credit report (yes, these are totally free and should not cost you anything–do NOT pay). You will not receive your credit score in these reports but you will see detailed information about what’s on your credit report. If you spot errors, work with the credit reporting agency directly to clear these up. This usually entails offering proof of some sort that you did pay the bill or that the debt is not yours. Once your dispute or proof is submitted, it usually takes 1-3 months for the score to be affected.

So what home buying options do you have when your credit is in the toilet? 

Talk to Homie Loans about your situation and whether any of these options can help get you into a home loan and building equity. 

Take on a co-signer/co-buyer: A parent may be willing to share the risk associated with your loan. The co-signer’s credit score will boost the likelihood you’ll obtain the loan, but if you default, the loan is on both of your shoulders.

Put more money into your down payment: When reviewing mortgage-worthiness, your lender will look at how much the home will cost relative to your income and other factors. If you put more money down on the home, your mortgage payment will be lower and can help offset a lower credit score. The same thing holds true for a lower-priced home.

Work with a mortgage broker, not directly with a lender: Whether your credit score is amazing, iffy or somewhere in between, working with a mortgage broker gives you access to more competitive options than mortgage lenders can provide. Mortgage brokers shop around to get the best overall costs/fees/interest scenario or their client’s budget. They’re not linked to a single financial institution, which can only offer that lender’s loan programs. Mortgage brokers frequently have access to wholesale mortgage rates and add their own “commissions” by inching up the interest rates slightly. Homies can tap into low costs and lower-rate loans through Homie Loans, which also accesses wholesale mortgage rates without the higher costs. To your wallet, the difference between Homie Loans and other brokers is frequently the lowest possible interest rate. As a bonus, Homie Loans also currently pays the price of the appraisal for all homes purchased through Homie.com. All in all, you may see both a a short-term reward and a long-term benefit amounting to considerable cash over the life of your loan with Homie Loans.

Extend your mortgage term: Aim for 30 years, the typical length of a first-time mortgage in the U.S., instead of a 15- or 20-year loan. Your payments will be lower, which can help you qualify for a loan more easily. Talk to your mortgage broker for more details.

Consider unique loan programs: Few of the truly odd or unique loans exist today (some of these probably helped usher in the mortgage crises), but checking with a mortgage broker before you start looking at homes can help you determine if you’re eligible for other programs like a VA loan that doesn’t factor in credit scores, a USDA/rural loan that requires no money down, or another unique home loan program.

Rent-to-own and owner financing: While you’ll still need to qualify, rent-to-own and owner-financing agreements can be great options for wanna-be homebuyers who can’t obtain a loan. Unfortunately they’re very hard to come by and you won’t be able to go through a mortgage broker or lender for either one. Your best bet is to luck into one of these, usually because you’re buying from family a close friend.

Should you sign a lease or buy a home if your credit is bad?
It’s true that poor credit can affect where you live, regardless of whether you’re renting a home or buying one. Before you decide to rent again, check with a Homie Loans mortgage broker to see if you qualify for a home loan. If the answer is “yes” (and stats say it’s likely–a 2015 report indicated the average credit score in Utah was 677; nationwide, Millennials had a score of 625; older generations had higher scores), go month-to-month on your lease. Then start the process by getting pre-approved for a loan and start shopping for the home you really want to live in. Get pre-qualified. 

Homie Loans is a Equal Housing Lender, NMLS# 1016597

Source: homie.com