Saturday, June 25th
2022 Home Loan Provider Reviews
SoFi
- "A+" rated by the BBB
- Sample interest rates and terms posted daily
- 3% down available for qualifying first-time homebuyers, 5% minimum down payment for all other borrowers
SoFi is short for "social finance" , and it relates to this lender's origins as a platform governed by private borrowers and lender/investors. Although SoFi now operates as a standalone financial institution, they still take a credit union-style approach to all of their financial products, even calling their customers "members" . SoFi offers home loans, in addition to many other options like credit cards, bank accounts, investments and more.
Easy to see rates and terms
We appreciate that SoFi gives you an idea of what to expect for loan rates and fees, without requiring you to sign up for an account first. You'll see the current rates for 10-, 15-, 20- and 30-year fixed rate loans right on their main Mortgages page, and the fine print at the bottom will give you examples that include typical closing fees. Also, at the time of this review, SoFi was offering a 0.25% purchase pricing discount on conventional 30-year loans. Prospective borrowers could get that confirmed when locking in their interest rate during the application process.
Confirm your identity for personalized rates
Of course, your rates and terms will depend on how much you want to borrow, your credit history, income, and many other factors. Click the "View Your Rate" button to get your personalized rates: you'll be asked for your first and last name, state, and email address. That creates your SoFi account, but you'll have to go further than that if you want to see your personalized rates: it takes a soft pull on your credit before you can see a chart with your rates, terms, and even a breakdown for the total you'll pay in interest over the course of the mortgage.
Can't complete application 100% online
From there, though, you can't complete your application without reaching out to the specific broker shown on your dashboard. As for closing costs (which can vary, and often can be negotiated) and other fees, you're not given any idea at this stage of the application. We don't like having to take those steps to get such critical information - especially when other home loan providers give you those details before submitting a formal, hard-pull-on-your-credit application.
Most SoFi home loan customers are unhappy
Since our last evaluation, SoFi's reputation with the BBB has improved slightly: they've got an "A+" rating, and there were no complaints filed there. Plus, previous alerts about misrepresentation on student loans and mortgages no longer seem to be in effect. Unfortunately, that doesn't mean that homeowners love SoFi: while we found almost 2,000 five-star reviews for this company, almost none of those were for their home loan products. In fact, practically every client review regarding mortgages was negative, and that's putting it nicely. Lowball appraisals, late delivery of funds for closing, and absent representatives on important transaction dates are just a few of the complaints logged by deeply unhappy SoFi home loan customers.
You've got better options
We don't recommend SoFi for your mortgage. This lender might be doing a "good enough" job on its other financial products, but with so many complaints specifically about their home loans, they're just not able to compete with the higher-rated companies we evaluated. You'll have a less frustrating experience elsewhere.
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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.
Home Loan Provider FAQ
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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