Are you looking to get a mortgage or refinance an existing loan? There are different options including banks, credit unions and non-bank lenders. Depending on your needs, a non-bank lender such as loanDepot may be a good choice.
But is it right for you?
This loanDepot review will walk you through the types of home loan products the company offers and the rates and fees you can expect to pay. It will also go over the loan eligibility requirements and the application process.
Whether loanDepot is a good option for you depends on your credit history and the type of loan you can get based on your eligibility. The best way to find out if loanDepot fits your needs is by getting a risk-free online quote.
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What is loanDepot?
Since launching in 2010, loanDepot has become the second-largest non-bank consumer lender and the fifth largest retail mortgage originator. The company has funded more than $165 billion in loans to date, including home, personal and home equity debt.
Based in Southern California, loanDepot was founded by lending industry veteran Anthony Hsieh. His background includes working on LendingTree, LoansDirect.com and E*TRADE Mortgage before creating his own lending platform.
The company offers home, personal and home equity loans and offers a quick approval process. It operates more than 150 loan locations nationwide with a team of 2,000+ licensed loan officers.
Review of loanDepot Home Loan Products
While loanDepot offers personal loans in addition to home products, this review will focus on mortgage and home equity loans. Below is everything you need to know about getting a mortgage, refinancing an existing one or taking out a home equity loan.
As a direct mortgage lender, loanDepot can offer faster closing times than the industry average. If you’re working on a short timeline to get a mortgage, this can be an advantage. You may also be eligible for a lower rate through loanDepot than through a bank lender.
The loanDepot’s team of more than 2,000 licensed loan officers can answer your questions without pushing you toward one option over another. In fact, the company has a “no-steering” policy, which means the lending officers are not incentivized to promote a particular loan.
If you want to speak with someone and ask questions about the quote you received or your loan options, you can make an appointment with a representative. Also, you can review loanDepot’s website for answers to some commonly asked questions and details about the loan process.
Check out the mortgage loan calculator on the company’s website to estimate your mortgage payment and determine how much you can afford comfortably. Getting a quote through the loanDepot website won’t impact your credit.
Depending on your loan type, the term can range between 10 and 40 years. They also offer adjustable and hybrid loans such as 3/1 ARM or a 5/1 ARM. Interest rates and fees can be competitive, depending on your credit and payment history and qualifications.
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loanDepot Mortgage Loans
One advantage of getting a mortgage through loanDepot is the variety of options. They offer jumbo loans, adjustable-rate mortgages (known as ARMs) and conventional fixed-rate options.
The company is also an authorized provider of Veterans Administration (VA) loans and Federal Housing Administration (FHA) mortgages.
loanDepot loan types and uses:
- Conventional loan – This loan is best for buyers who have strong credit. It is also a common loan for repeat home buyers. This type of loan can require a 20 percent down payment (although it could go as low as 3 percent).
- FHA loan – These types of loans are popular with first-time home buyers. They have lower credit score requirements and can accept a down payment as low as 3.5 percent. The loans are subject to property and credit approval.
- VA loan – If you’re a veteran or active-duty service member, you may be eligible for a VA loan. These loans are guaranteed in part or in full by the Veterans Administration, allowing the lender to offer more favorable terms. Some loans even offer the option for a 0 percent down payment.
- Jumbo loan – This loan is for an amount over the conforming limit. It’s best for buyers in high-cost markets or those purchasing a luxury property. The down payment can be as low as 5 percent but depends on eligibility.
- ARM loan – Adjustable rate mortgage-loans have an interest rate that adjusts periodically. The rate is based on how much it costs the lender to borrow the funds. The initial rate of the loan is fixed for a period, after which it adjusts every year or even monthly.
Mortgage Refinance Loans
If you’re looking to lower your mortgage payment or lock in a lower rate, you may be interested in refinancing an existing loan. This is especially true if you have an adjustable-rate mortgage, and your rate will reset soon.
A refinance can also make sense if your income has increased or you’ve been able to raise your credit rating. loanDepot’s loan officers can help you determine if getting a new mortgage would be a better option than your current one.
Before refinancing your home, you need to do your research. Know what questions to ask, what loans would be best for your situations, how much your refinance payment will be and the fees associated with a new loan.
Even if you have a second mortgage, you can still refinance your loan. During the process, loanDepot will merge the two loans into a new mortgage, and you will have only one monthly payment.
Sometimes, you can refinance just your first loan, but you will need to speak to a loan officer to determine if this is an option for you.
Home Equity Loans
If you’re looking to borrow a portion of your home’s value, you can do a home equity loan through loanDepot. This is a fixed-rate second mortgage that allows you to borrow up to 90 percent of your home’s value.
Some people use home equity loans to free up cash for a large purchase or consolidate debt. They can also finance a remodel or an addition on a house.
Loan amounts and terms range depending on your needs and qualifications. Just like with mortgage loans, closing on home equity loans is faster than the nation’s average. There is also no need to refinance an existing mortgage to get a home equity loan.
loanDepot Rates and Fees
Some important factors to consider when evaluation lenders are the rates and fees associated with borrowing money. This can add up to a significant chunk and make the difference between a good deal and a bad one.
Keep in mind that mortgage rates are not static. They can change daily, so the rate you see on a loan today may be different a week from now. Many factors go into the mortgage rate you are quoted, and the lender you select is just one of them.
Your rate can be affected by your credit and payment history, your debt-to-income ratio, and so on. Those with the best credit and repayment history will get offered the lowest rates, while borrowers with spottier records will have to pay more to get a loan.
The type of loan program you qualify for is another factor in your mortgage or home equity loan rate. Loans through the VA or FHA program will have different rates and fees than ARMs or conventional ones.
While fees vary from lender to lender, most will charge for an appraisal, underwriting, processing, getting credit reports, notary, title and escrow. Other factors that affect the rate include the type of loan, the loan amount and term.
Getting a quote is the best way to determine what rates you can expect on your loanDepot mortgage or home equity loan. Since a quote won’t affect your credit, it’s a good way to judge if this is a good option for you.
loanDepot Eligibility Requirements
Before getting a quote from loanDepot, you want to make sure you meet the general loan eligibility requirements. Certain loans may require additional qualifications for approval. Here’s what you need to qualify:
- 18 years of age or older (19 in Alabama and Nebraska)
- You are a U.S. citizen or permanent resident
- A valid email address
- Income that can be verified
- A bank account that can be verified
- Meet credit criteria requirements
If you purchase a home or refinance a home loan, you can get a co-signer. Not all lenders allow this option, so double-check before applying for a loan based on having someone else co-sign with you.
loanDepot Application Requirements
Applying for a loanDepot loan is simple. The company offers the option to fill out the application online or call in. Here’s what information you will need to complete the loan application:
- Date of birth
- Email address
If you decide to accept the loan offer, you will need to provide additional information, including:
- Social Security number
- Bank account
- Employment details
- Supporting documentation such as bank statements, W2, recent pay stubs and a government-issued ID
Those that are self-employed may be required to submit additional documentation.
loanDepot Application Process
Based on the information you provide in the preliminary application, loanDepot will come back to you with the types of loans that fit your eligibility. This will be based on your credit, income and other factors.
The company uses a process they call mello smartloan™ to connect your income, employment and assets digitally. This can be a real time-saver as you don’t have to chase down all the individual pieces of data required for the loan process.
Once you select a loan type and get pre-approved, the loanDepot underwriting team will verify the data you provide. This can take anywhere from two to three days on average, although it can be longer.
To ensure you receive your approval faster, provide accurate information on your application, and submit the required documents quickly. When all the information has been verified, you will receive a final loan approval.
If you change your mind and want to withdraw your application, you can do that before the loan is submitted for funding. Once funding occurs, loanDepot can’t stop the funds from being deposited into your bank account.
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When the loan is approved, and the process completes, you will set up your payments. The monthly amount due will be deducted automatically from the bank account you provided. If you would like to use a different account, you can call and get it changed.
Keep in mind that there is no way to change the due date. However, you have a grace period of 15 days to pay your mortgage. After the 15 days, you will get a late fee added to your payment. Payments more than 30 days late may be reported to credit bureaus and reflect on your credit history.
The Bottom Line
Whether loanDepot is a good option for you depends on your credit history and the type of loan you can get based on your eligibility. Not all lenders offer VA, FHA or home equity loans, so if you meet the criteria, consider loanDepot as an option.
loanDepot can also be a suitable option for those looking for a good blend of an online and face-to-face loan application. You can complete part of the process online and also work with someone over the phone or in-person to get your loan questions answered and finalize the details.
The best way to find out if loanDepot fits your needs is by getting a risk-free online quote. Since the quote only makes a soft inquiry, it won’t affect your credit. However, it will provide you with enough information to see if you get the best loan rates for your situation.
Have you used loanDepot to get a mortgage? What was your experience? Share in the comments.