Better Mortgage Review
Better Mortgage Corporation is a direct mortgage lender based in New York. You can refinance your existing mortgage or get a loan for the purchase of a home through Better Mortgage. Their mission is to use technology to replace the old mortgage process, which means less paperwork and fewer barriers to getting a home loan for borrowers.
This company doesn’t charge origination fees, and they offer an on-demand rate lock. The entire mortgage loan process is online. Better Mortgage promises to beat competitor pricing. Customers who receive a loan estimate with a more competitive price can submit that offer, and Better Mortgage will either match it or give the customer $1,000. This “low price promise” makes going through the pre-approval process with Better Mortgage a risk-free proposition for borrowers.
|Mortgage types||Purchase, refinance, fixed, adjustable, jumbo|
|Repayment terms||15 Years, 20 Years, or 30 Years|
|APR||3.61% (Refinance), 2.12% – 2.69% (purchase)|
|Minimum credit score||620|
|Lender type||Direct lender|
Better Mortgage Loans: Pros
- Better Mortgage offers a Low Price Promise
- No origination fees, lender fees, or commission fees
- 100% online-based and available 24/7
Better Mortgage Loans: Cons
- Better Mortgage only works with customers who have credit scores above 620
- If applying for a loan with a co-borrower, underwriters use the lowest credit score for qualification purposes
- No government-backed loans such as USDA or VA mortgages
1. Submit a short application.
To apply for a home loan with Better Mortgage, you’ll submit a short application to get a pre-approval letter. This document lets you know how much you could potentially borrow if you later meet the requirements of the financial review, property appraisal, and title report. This letter allows you to make a formal offer on a home, and it tells the sellers that you have started the process of getting a home loan and could qualify for a mortgage.
2. Receive the pre-approval letter.
It takes just a few minutes to get a pre-approval letter online from Better Mortgage. Questions include your status in the home buying process (are you only shopping or ready to make an offer?), when you plan to make a purchase, and where your potential home is located. You’ll set up an account with your email address and answer some identity questions like your full name, address, and social security number. Better Mortgage conducts a soft credit pull that doesn’t affect your FICO score. They use data from your FICO Classic 04 score from Trans Union. If you meet the approval criteria, Better Mortgage generates a pre-approval letter that you can show to your real estate agent and sellers of homes you are interested in purchasing.
When you are ready to get a verified pre-approval letter, which lets you know precisely how much Better Mortgage is willing to lend you, you’ll need to gather your recent pay stubs, tax returns, and W-2 forms. If your housing market is exceptionally competitive or you want to close your loan quickly, a verified pre-approval letter is a useful way to achieve certainty that you are shopping in the right price range. The verified pre-approval process includes a hard credit check, which may negatively affect your credit score by five points or less.
3. Submit a formal application.
After finding a home and settling on a price with the seller, you’ll submit a formal application for a mortgage through Better Mortgage Corporation. They’ll issue a Loan Estimate Form within three business days, as required by the Consumer Financial Protection Agency. Lenders are bound by law to provide the information required by this standard form. The total amount in section D plus the total amount in section J equal the total cost of the loan. Use Loan Estimate forms from multiple lenders to compare loan terms and get the best deal.
Since interest rates are always changing, it’s important to lock your rate with your lender as soon as you know approximately when you’ll close your loan. Better Mortgage Corporation will lock your interest rate upon request 24/7 online.
It typically takes three to six weeks to complete the mortgage process with Better Mortgage Corporation. You’ll have a dedicated loan officer to help with the process.
Terms & Requirements
Better Mortgage Company has a standard set of requirements for their mortgages. Since they only offer conventional loans, the minimum credit score is 620. They require proof of employment or self-employment for the past two years and a debt-to-income ratio of at least 45%.
There are many requirements to get a loan from Better Mortgage Company, such as down payment amount depending on your income, employment history, and credit situation.
Interest rates change several times each day, so Better Mortgage Company’s 24/7 online rate lock service and their Low Price Promise work in favor of the borrower. You can find current purchase and refinance interest rates as well as APRs on their website for 30-year, 20-year, and 15-year fixed mortgages.
Better Mortgage Company offers loan terms of 15, 20, or 30 years. Monthly payments may include deposits to your escrow account if you choose to use this tool to pay property taxes and homeowner’s insurance. Better Mortgage Company does not require an escrow account for most borrowers. If you decide not to use an escrow account, you’ll pay only the interest and principal due each month on your mortgage loan. You’ll be responsible for paying homeowner’s insurance premiums and taxes separately.
Privacy & Security
Better Mortgage is a direct lender that processes mortgage applications, underwrites the loan, closes, and funds the loan. They are not a permanent loan servicer, however. After completing the process, Better Mortgage sells individual mortgage loans to investors, which provides permanent servicing. Although you may make your first few loan payments to Better Mortgage Corporation, they will transfer ownership of the mortgage to an investor, and you’ll deal directly with that servicer for the remainder of the life of the mortgage.
Better Mortgage customers who encounter problems with their permanent servicer can email for help resolving the issue. Better Mortgage promises to work on the borrower’s behalf to solve issues with permanent servicers.
The advantages of using Better Mortgage are obvious. It is a completely online process making it very efficient from start to finish. You also have a few different types of mortgage loans to choose from, as well as getting access to competitive rates. Therefore, Better Mortgage can be a consideration among other competitors in the home loan market today.
Better Mortgage Corporation | 120 Broadway, 5th Floor, New York, NY
Better Mortgage Disclaimer: © 2020 Better Holdco, Inc. and/or its affiliates. All rights reserved.Home lending products offered by Better Mortgage Corporation. Better Mortgage Corporation is a direct lender. NMLS #330511. 120 Broadway, 5th Floor, New York, NY 10271. Loans made or arranged pursuant to a California Finance Lenders Law License. Not available in all states. Equal Housing Lender. NMLS Consumer Access. Better Real Estate, LLC is a Virginia Licensed Real Estate Firm with its principal office located at 312-F East Market St., Leesburg, VA 20176. License #0266029484. Equal Housing Opportunity. Better Settlement Services, LLC. 175 Greenwich Street, FL 59, New York, NY 10007. Homeowners insurance policies are offered through Better Cover, LLC, a Pennsylvania Resident Producer Agency. License #881593. 175 Greenwich Street, FL 59, New York, NY 10007. Better Cover is Registered in the U.S. Patent and Trademark Office. Better Mortgage Corporation, Better Real Estate, LLC, Better Settlement Services, LLC and Better Cover, LLC are separate operating subsidiaries of Better Holdco, Inc. Each company is a separate legal entity operated and managed through its own management and governance structure as required by its state of incorporation, and applicable and legal and regulatory requirements. Products not available in all states. The Better Home Logo is Registered in the U.S. Patent and Trademark Office