Ally Bank Mortgage Review
How Does Ally Mortgage Work?
If you are a technically capable person, with good credit, stable income and cash saved for a down payment and closing costs, Ally is a great fit for you. The company makes it easy to manage your experience in the online format, but also provides real people with whom you can connect regularly and who will help you manage the process if there are issues.
However, if you have any issues that would make qualifying for a standard conventional loan challenging, another lender would be your cup of tea.
On Ally Secure Website
Minimum Credit Score
Reputation - Customer Ratings & Complaints
- B+ on BBB: BBB assigns ratings from A+ (highest) to F (lowest). BB ratings are based on information in BBB files with respect to factors such as business's complaint history with BBB, type of business, time in business, transparent business practices and more.
- 1/5 on BBB customers reviews (2 reviews): BB customer reviews allow customers to post positive, negative or neutral reviews based on lender's experience
- J.D Power: We considered 2020 J.D. Power’s primary mortgage as well as J.D. Power’s claim satisfaction survey.
- J.D Power offers the most comprehensive and independent study of customer satisfaction. The study aims to help consumers and issuers to understand user opinions and ratings of the largest mortgage origination companies. It covers customer satisfaction, terms, communication, transparency and more.
Mortgage Products, Fees, and Conditions
Ally’s product line-up is standard – they do not try to be all things to all people, which improves their efficiency. They are a conventional lender that funds conforming, agency (Fannie Mae and Freddie Mac) loans, as well as non-conforming (Jumbo) conventional loans, which are for loan amounts that exceed the conforming loan limits.
For all states, the maximum “true” conforming loan is $453,100. In high-cost states, the maximum “high balance” conforming loan can reach $679,650. This maximum varies from state-to-state and county-to-county. When a loan exceeds the high balance limit for the county in which the property is located, it is known as a non-conforming, or “jumbo” loan and the rules for qualifying are different than for conforming loans. These options define Ally’s lending activity.
In practice, all of Ally’s loans work in the same way – you will choose between a conventional conforming or non-conforming loan (Jumbo), based on your purchase price.
Ally participates in Fannie Mae’s HomeReady program for first-time buyers. Recognizing that many borrowers have sufficient income to qualify, but lack adequate down payment, Fannie Mae and Freddie Mac recently rolled out a lower down payment version of their programs, allowing for 3% (if true conforming) or 5% (if high-balance conforming) down. The qualifying has become more flexible and the mortgage insurance cost reduced, as well.
Pros & Cons
Ally’s Mortgage Process
Ally Bank has been a strictly online lender since its inception in 2009. It is a subsidiary of Ally Financial, located in Detroit, Michigan. The bank itself is located in Sandy, Utah. Its head office is its only branch. The internet has made it possible for Ally Bank to conduct its savings and lending operations online, which allows for efficiencies that brick and mortar banks don’t enjoy.
Why is this important?
Because the savings that result from these efficiencies pass through to the consumer, in the form of lower interest rates for borrowers and higher interest rates for savers.
The application process is online and the website is “plain English” and easy to understand. A prospective borrower can go step-by-step through several preliminary questions and use one or more of several calculators, including a home affordability calculator, a payment calculator and a refinance calculator. There are also savings calculator that can show consumers how to reach their homeownership, retirement and other goals.
Once the prospective borrower has completed and reviewed the preliminary information, the process is simple and the site is organized so that the borrower can step from one stage through the next. The five steps are:
This shows the seller that you are serious. The minimum of pre-qualification is required in nearly all real estate markets in the US. Pre-qualification is where you provide the basic information about your income, down payment to your Ally Home Team.
They obtain your credit report and issue a letter that says that, based on the information provided, your loan will be approved, according to the guidelines. This letter is provided to you and can be presented to the seller so that they feel comfortable that they can accept your offer. Accepting your offer means the seller will hold any further marketing efforts until you close.
In the most active housing markets, where supply is a concern, the seller may require a “pre-approval”, in which you have submitted a complete file and an underwriter has approved it, subject to the title work and appraisal of the home.
This stage is self-explanatory. There is a list of documentation that every borrower must provide to the lender, to prove creditworthiness.
A short list (for a first-time, salaried buyer with good credit) would include copies of paystubs, W-2 forms, bank statements and possibly two years’ tax returns.
For more complex situations, more documentation is required.
This is the process where, when all the documentation has been submitted, an underwriter reviews and verifies the information contained in the documentation, checks the loan against all guidelines and issues a loan approval.
In a well-documented file, the approval will be subject only to the documentation that would be needed to fund the loan.
The closing occurs when all the conditions have been satisfied, you have signed the closing papers, transmitted the down payment and closing costs and the transaction was recorded.
Within the first 30 days of closing, you will receive a number of documents – your official closing statement, the original deed that evidences that you are the owner, title insurance or warranty, correspondence from Ally about where to make the payments and many offers to sell you things!
At each step, Ally tells you what your responsibilities are and what Ally’s responsibilities are.
Each loan is assigned to a dedicated team of three representatives – a licensed loan specialist and two processors. The loan specialist takes the information, completing the application that you begin online. The processors interface with the borrower to complete the documentation required for the file and have it approved. Regular communications are promised and according to the reviews that can be found, the promise is honored by the team.
We’ve summarized some of the most popular mortgage lenders which can use as an alternative to the Ally mortgage:
Better Mortgage, an online lender, came into existence in 2016. It provides an excellent online service where resources, loan approval and rates are readily available. It also offers different mortgage and loan options for individuals that want to buy home; Federal housing administration (FHA) loans, bridge loans, jumbo loans, and conventional out loans.
To get a conventional loan from Better Mortgage, you need to have an excellent credit score, FICO score of 620 or more and an income to debt ratio of about fifty-five percent.
Currently, Better Mortgage is funding about $450M monthly loans, and it has successfully funded about 15,000 loans. The Bank offers a zero down loan, and it does not require any private mortgage insurance. Also, members can borrow 100% of their equity on the home equity loan.
Better Mortgage provides a coherent and easy to navigate the loan application process and does not charge any fee. The Bank uses an outstanding digital mortgage experience, which makes it easy to get a rate quote immediately and verified preapproval within 24 hours.
The Better Business Bureau has accredited better Mortgage, and it has an A+ rating with four stars out five stars from 238 customers that provided reviews. Aside from this, it has 4.3 stars out of 5 stars from customers review on Bank rate, Lending Tree and Zillow.
Flagstar Bank offers a wide range of mortgage division. The Bank allows you to open a number of different fixed-rate mortgages to home loan to VA Adjustable-rate loan, construction Draw loan, refinance loan, jumbo loan, one-close loan, multiple property loan and government backed-up loans such as; USDA Rural Development Loans, Federal Housing Administration Loan. However, they do not provide renovation loans, and the home equity loan is limited geographically.
To be eligible to get a loan at Flagstar, you need to have a minimum credit score of 620 and a minimum down payment of 3%. However, to apply for the FHA Loan, the borrowers must have a minimum down payment of 3.5% and zero down payment for USDA and VA loans.
Flagstar makes use of a smattering mortgage calculator that helps borrowers understand and figure out the options for there home loans. The mortgage calculator also helps the borrowers to keep track of there down payment, how much can be borrowed and the monthly payment amount. This makes them one of the banks that do well with rate transparency.
Flagstar received a 3-star 0ut of 5 stars by the Home Mortgage Disclosure Act in the average lender origination fee. In 2017, the Bank was rated three 0ut five stars by J.D. Power in the United States Primary Mortgage Origination Satisfaction Study and was also rated B- by the Better Business Bureau.
Lending Tree Mortgage is an online lending company that has been operating for 3o years. Unlike conventional lenders, they allow individuals to request loans and get approval from the comfort of their devices and over the internet. They require a minimum credit rating of 620 and a minimum down payment of 3.5% to obtain their loans. The service is free to use, although some charges vary based on the loan you require. The service is available in all states in the US.
Some of the loans offered by this provider include VA loans, FHA loans, Jumbo loans, Home equity loans, USDA loans, and conventional Mortgages. Some of the Documents you will need to secure a loan include social security number, home address, date of birth, and your credit score. All you need to do is visit the company website and fill out the required form online to get the best offers from Lending Tree Mortgage.
Since its founding in 1998, the company has provided loan services for people around the country, and they received a B rating from the Better business bureau with a 3-star average in 2019. If you want to get quality service from lenders, you can trust Lending Tree Mortgage.
About Ally Bank
Ally Bank began life as GMAC in 1919 , as a division of General motors. During the 1920s through the 1970s, the company evolved and in the 1980s and 1990s, the company expanded into home mortgages. In the 2000’s, GMAC Bank was formed and in 2009, it was transformed into Ally Bank, at which point, they adopted the streamlined lending processes it uses today.
Ally was among the first banks to conduct all their operations for both savings and lending, online. However, they maintain the human touch in their interactions with those seeking to do business with them. Rather than let customers struggle with completing the multi-page standard application, the borrower gives minimal basic information online and then requests a call from an Ally loan officer. The officer completes the application by phone.
From the moment of that first call, the customer is assigned to a team that will guide them through the process, from origination through closing. Taking a page from baseball, your team is called the “Ally Home Team” and the team of three assigned to you will be your point of contact from the beginning through the closing of your loan.
Ally offers a price match. If you find better pricing at another lender, let them know. You have to send a complete Loan Estimate from the competing lender when you’re ready to lock in your rate. Ally will match their rate and points as long as it is for the same loan terms offered and dated within the past 5 business days. This ensures that you will get a competitive rate.