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Freedom Mortgage Review

Monday, June 5th

2023 Home Loan Provider Reviews

Freedom Mortgage Review 2 Star Rating

Freedom Mortgage

2 Star Rating
  • Open to residents of all 50 states, as well as DC, PR, and USVI
  • In business for over 30 years
  • "A+" rated by the BBB
  • Available loan types: Conventional, VA, FHA, USDA

For more than three decades, Freedom Mortgage has been providing home loans and refinancing. This lender serves residents of all 50 United States plus Washington DC, Puerto Rico, and USVI, with over one million borrowers in their client "family" .

Four available loan types

You've got four possible loan types when using Freedom Mortgage for home loans: Conventional, VA, FHA, and USDA. Of course, not all applicants will qualify for every loan type, but at least they're available for those who do. Not sure which ones are right for you? Click on the "Learn More" button beneath each loan type's bullet points to get a quick education.

Simple process

There's a four-step process when getting a home loan here. First, get pre-qualified. In five minutes or less, and with a soft credit check, you'll get an estimate of how much you can borrow. This step also results in a prequalification letter you can give to your real estate agent, and it may help you stand out over other prospective buyers. Now that you know what you can afford, it's time to find your castle, condo or cabin. If you don't already have an agent, Freedom Mortgage partners with HomeStory and can match you with a professional near you.

Helps you know what to expect

When your bid on a home has been accepted, it's time to complete the full mortgage application (since prequalification was just the start). There are some helpful checklists on the Freedom site that will tell you the documents you'll need at this stage: you might as well make sure you have everything, regardless of where you take out a home loan. You can also read about the mortgage loan process, so you'll know what to expect and when.

Several options for closing

The last step is closing. While some lenders make you go to a third-party location, usually a title company, Freedom might be able to bring the closing to you. Check with your assigned loan officer to see what your options are.

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Can't see rates in advance

Are Freedom's home loan rates competitive? Great question. When you click on the "Mortgage Rates" link at the top of the site, you're taken to a page that tells you... to give them a call or create an account. We understand that mortgage rates are very specific to each lender, to market conditions, and so forth - but a ballpark prior to signing up or getting on the phone would be nice.

Doesn't always resolve problems

How about Freedom Mortgage's reputation? We were glad to see that they have an "A+" from the Better Business Bureau, but a little less so when we saw almost 1200 complaints filed in the past three years. From what we gathered, Freedom maintains that "A+" by being sure to answer all complaints - but not necessarily by resolving them to their clients' satisfaction. Comment after comment, a pattern emerges of poor communication, late or nonexistent responses to account and payment issues, and difficulties in getting help from Freedom support. True, with over a million customers, a thousand complaints is a drop in the bucket. But when you're trying to resolve problems that can have a huge impact on your credit score, you want prompt responses from your mortgage company - and we're not confident that Freedom delivers.

Issues from start to finish

Plus, these problems seem to occur all across the home loan lifecycle, from application to servicing. Delayed communications can not only create those problems we mentioned with respect to credit histories, but also with successfully getting to closing in the first place. In a hot real estate market, you could lose the home of your dreams if your lender isn't 100% on the ball. We also read dozens of comments from homeowners whose mortgages were sold to Freedom, and who said that the experience has been nightmarish. Not a good sign.

We recommend using a different lender

For all of these reasons, Freedom Mortgage is not a lender we can comfortably recommend. You've got literally hundreds of options for getting a home loan, so why not choose a company that demonstrates a higher commitment to getting your paperwork done on time and answering any questions or concerns quickly too? You'll find several better options among the higher-ranked lenders in our review.

Where Can You Get the Best Home Loans?

Your first thought might be to visit your local bank or broker, but think again. Why? You're not likely to get the very best rates and terms there. True, you might get a promo or slightly lower interest rate for being a current customer, but will your financial institution shop around to find you the ideal loan for your situation?

More than likely, they'll fit you with whichever mortgage is convenient (or profitable) instead of working to get you a home loan with the best possible terms. With interest rates constantly fluctuating, it's never a bad time to start looking into your financing options if homeownership is your goal. Even if you're just curious to see how much you can ultimately afford when the time comes, that will help you start budgeting and saving to have enough to secure your new home when you're ready.

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Home Loan Provider FAQ

Yes, a home loan is the same thing as a mortgage: borrowing money to purchase a home. Home loans are different from home equity loans or home equity lines of credit: the former represents the funds you use to buy your home, while the latter two are used to borrow money against any equity you've built up in the property.
Lenders use many factors to determine your eligibility to take out a mortgage. One of the biggest is your credit history: your credit score, your debt-to-income ratio (i.e. how much you owe on credit cards and any other loans vs. how much you earn), any missing or late payments, and so forth. Other factors include the amount of your down payment, how long you've had steady employment, and the purchase price of the home you want to buy.
It's commonly said that you can afford to buy a home that costs anywhere from 1.5 to 2 times your yearly gross income, but there's a lot more to consider. How much will you pay for property taxes and insurance? Do you have any other debts, like car payments or student loans? How much money will you put down at closing? There are plenty of sites that offer tools to help you calculate how much you can afford to borrow when buying a home; these tools take into account many of these components to give you a more accurate picture of your borrowing power.
Prequalifying for a home loan means that you've taken an informal look at your finances to determine how much you can afford and whether you meet the minimum requirements to take out a mortgage. This can be done without going too deeply into your financial information. On the other hand, a preapproval is given when you complete a full mortgage application: the lender accesses your full credit report and gives you a written offer for a loan at a specific interest rate, subject to your finding a home to buy and completing the underwriting process. Having a prequalification or preapproval letter can make you a more compelling candidate to buy a home and may put you ahead of other parties making an offer.
Yes, especially if you're a first-time home buyer. There are VA loans with no down payment required if you have a military connection, USDA loans with 100% financing on rural properties, FHA loans for buyers with less-than-stellar credit, and many more. While those programs are all federal, there are additional home-buying programs offered by individual states that may also help you get a loan.
An escrow account holds money in reserve to pay your homeowner's insurance, property taxes, and PMI (if required). Your lender collects that money with your monthly mortgage payments, and then disburses the funds to your insurance company and local tax collector by the due date. Some home loans require you to have an escrow account, while others may allow you to pay your taxes and insurance on your own. (But you'll have to make sure to set aside the money, since it won't be collected automatically each month.)
PMI stands for "private mortgage insurance" . It's a fee you may have to pay each month if you're not going to make a down payment of at least 20% of the total loan amount. This third-party insurance coverage protects your lender if you default on your mortgage. You can usually request to have those payments removed once you've reached an equity level of at least 22%; that can be accomplished by making your regular monthly payments over time, by making additional payments towards the principal balance, or by submitting an appraisal showing that your home would currently sell for an amount that would give you the necessary equity (i.e. if home values have increased significantly since the date of purchase).
Absolutely. Some of today's most competitive rates are offered by online-only mortgage lenders with thousands of satisfied customers and a strong reputation for integrity, efficiency and affordability. Of course, it's always a wise idea to check out the background of any home loan provider you're considering prior to offering sensitive financial information or documentation. The Better Business Bureau is a good resource to determine a company's history, as well as current customer reviews.
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Continued from above...

Some mortgage terms stipulate that the funds can't come from a last-minute gift or contribution from a well-meaning family member, so plan ahead!

The easiest way to know how much you can borrow is by shopping for a home loan online. While some lenders require you to enter your personal information to show you their rates, others post sample rates online or let you choose your credit score range and other details to preview a more personalized quote. Be mindful that there's a difference between a "soft pull" on your credit - usually used to prequalify you, and only uses your address and phone number to verify your identity - and a "hard pull" that will impact your credit history.

The latter usually happens only when you've got a home under contract and you're ready to secure a mortgage, but pay attention to the fine print when you're checking out a lender's rates. You don't want to be "just browsing" and find out that your credit score took a nosedive with an unintentional hard inquiry on your report!

With many lenders interested in your business, how can you decide which one to use for your mortgage? Here are a few factors to look at before you complete a loan application:

  • Loan types. Most people choose a conventional fixed mortgage of 15 or 30 years, and the majority of lenders offer that. If you're looking for something different, like an FHA loan or an ARM, you might need to shop around a bit more.
  • Transparency. How easy is it to see the lender's current rates and fees? Can you get an idea on their main site or do you have to create an account first?
  • Closing costs. The best home loan providers will tell you what to expect well in advance. Some include that information in the disclosures in the fine print at the bottom of the site, even before you give them any of your personal details. Others provide it when you've given them enough info to verify your identity but before filling out a formal application. Some closing costs are negotiable, so don't be afraid to ask any lender to make you an offer.
  • Reputation. What do borrowers say about their experience with the financial institution? It's one thing to have great loan rates, but if the lender drops the ball during the purchasing process or if their customer service after closing is a nightmare, it's not worth the money you might save. Consider the lender's rating with the Better Business Bureau to start, but also look at recent customer comments to get a snapshot of how well the home loan provider is doing across the entire lifecycle of the mortgage (from pre-application to post-closing servicing).

To help you finance the home of your dreams, TopConsumerReviews.com has evaluated and ranked today's most popular mortgage lenders. We're confident that this information will be useful on your journey to home ownership. Congratulations!

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