Guaranteed Rate Mortgage Review 2019


Guaranteed Rate Mortgage Review 2019

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Guaranteed Rate is a US residential mortgage company, headquartered in Chicago, with 170 branches throughout the country.  Guaranteed is licensed to do business in all 50 states.  In 2017, Guaranteed Rate ranked 6th in overall funded mortgage volume among the top 75 lenders, according to respected industry publisher the “Scotsman Guide”.  Their nearly 1400 originators closed over 61,800 loans and a total of over $19 billion in volume.

According to its website, Guaranteed Rate enjoys a 95% approval rating from its customers.  They pride themselves on putting the customer first, their core values and the use of technology to ease the process and empower the customer.

Overview

Guaranteed Rate has a full complement of mortgage products, offering standard mortgage products and a few specialty mortgages.  Also, Guaranteed Rate does not offer loans for people with alternative credit or income that is challenging to document.

Pros

  • Broad options for many different types of borrowers
  • You can apply from any type of device, in person, or by phone.
  • One of the most user-friendly mobile app in the industry, advanced digital approach

Cons

  • Turnaround times
  • Retail branch offices are in 50 states, but in some states, there is only one branch.
  •  Continuity between the loan officer and the funder can be challenging.

About Guaranteed Rate

Founded in 2000, Guaranteed Rate grew rapidly and cracked the Top 10 of mortgage lenders nationwide in 2013, the year in which it was also named one of the fastest growing businesses in Chicago.

Guaranteed Rate’s growth was both organic and through acquisitions.  The company acquired Manhattan Mortgage, Sunstate Home Loans, Nationwide Direct, Arbor Mortgage and First Trust Mortgage, with each acquisition contributing to Guaranteed Rate’s robust growth.

In July, 2015, Guaranteed Rate rolled out its online platform called “World’s First Digital Mortgage” and followed that with “Intuitive Loan Finder”, an online tool which helps borrowers find a mortgage.

In 2014, the company spent $10 million in advertising, including signing Ty Pennington, of HGTV fame, as their spokesperson.  He represented them in their 2016 Super Bowl advertising effort.

In addition, the company has earned many awards, including:

  • 2013 Successful Private Company – Inc. Magazine
  • Top Private US Job Creator – Inc. Magazine
  • Lender of the Year – Chicago Agent Magazine
  • Moxie Award for Best Corporate Digital Innovation 2013

How Does Guaranteed Rate Work?

You can obtain a mortgage from Guaranteed Rate in one of three ways.

Visit one of the 170 Guaranteed Rate branches if you are near one. Guaranteed Rate has offices in all 50 states.

Call 1-866-934-7283 and talk with a loan officer.

Apply online at guaranteedrate.com/ or by downloading and using the mobile app on any mobile device.

Guaranteed Rate Mortgage Products, Fees, and Condition

Guaranteed Rate has a full complement of mortgage products, offering standard mortgage products and a few specialty mortgages.  Also, Guaranteed Rate does not offer loans for people with alternative credit or income that is challenging to document.

Guaranteed Rate’s fees are up to $1,290 for all loans, which includes an application fee, processing, and underwriting fees.  They quote rates with no origination fee, but for certain loans, such as FHA, VA, and USDA, there may be an up-front insurance premium or guarantee fee, which are charged by the respective agencies. In addition, there are other closing costs that are not charged by Guaranteed Rate and which vary by the location of the property.

Guaranteed Rate’s turnaround times average 15 – 30 days.  The 15 day approval is part of Guaranteed’s Red Arrow Approval Express Program, which involves starting the process early enough to allow a live underwriter to review the file.  With Guaranteed Rate, you can apply, move through the process and even sign your closing documents in advance of your closing date, so that the appointment at the closing table is ten minutes, instead of an hour.

Following is a brief description of the mortgage products you can find at Guaranteed Rate.

Agency Conventional 30-Year and 15-Year, Fixed-Rate Loans

For those who want a steady interest rate and consistent payments over a long period of time, providing peace of mind and a consistent budget.

  • 3% – 5% minimum down payment for qualified borrowers.
  • No private mortgage insurance (PMI) required with 20% or more down.
  • Renovation loans with as little as 5% down.
  • Closing cost credits up to 3% allowed from the seller.
  • Regular, qualified income required.
  • The minimum credit score is 620.
  • Maximum loan is $453,100 – $679,750, depending on property location.
  • Best for those who plan to live in their home for 5-10 years.

Jumbo 30-Year and-15 Year Fixed Rate

These loans start with amounts that are $1 higher than the agency conforming limit – at $453,101, up to $679,651, depending on the location of the property.   How do you know if a Jumbo loan is right for you?

  • Your income and finances are on the upswing.
  • You want to own a higher-value property but don’t have the cash to pay down.
  • You want to bypass the starter home.
  • The maximum Jumbo loan is $5 million.
  • The minimum down payment is 10% – 15% of the purchase price.
  • Jumbo loans require 3 – 12 months of payment reserves (PITI x X) adding significantly to the cash to close.
  • The minimum credit score is 620 for conforming loans and 680 to 740 for jumbo loans.

Agency and Jumbo 5/1 and 7/1 ARM

ARM (Adjustable Rate Mortgage) is a home loan with an interest rate that changes after the first five or seven years.  In other words, these loans have interest rates which are subject to change during their life.  After the first five or seven
years, the rate changes annually, subject to caps to the increases.  A 5/1 ARM or 7/1 ARM may be for you if:

  • Believe you will be in the home for a short time.
  • Want to purchase a higher-priced home.
  • Want to have lower payments than you would have with a fixed rate loan.
  • Not concerned about your ability to pay if interest rates rise later.
  • The minimum credit score is 620 for conforming loans and 680 – 740 for Jumbo loans.
  • Maximum loan-to-value is 95% (5% down) for conforming loans and 90% – 85% down for conforming loans..
  • Want an interest rate lower than for a 30-year fixed rate.
  • You want to maximize cash flow through lower payments.

FHA 30-Year and 15 Years Fixed Rate

These loans are well-suited to those who have limited funds for a down payment or whose credit history is not pristine.  They reduce the barriers to entry into the housing market by featuring low down payments, flexible credit requirements,
and more purchase power.  An FHA loan may be right for you if:

  • Need a down payment as low as 3.5% of the purchase price.
  • Need more flexible underwriting requirements than for conventional loans.
  • Your credit score is as low as 580.
  • Need seller assistance of up to 6% of the purchase price.
  • Need a “renovation” loan that will provide funds for fixup after purchase.

VA 30-Year and 15-Year Fixed Rate

Eligible veterans can obtain 100% financing using their VA eligibility, to a maximum loan of $679,750, depending on the location of the property. No down payment required.  30-year fixed rate loans are the most commonly used VA mortgage program.  A VA loan might be the best loan for you if you:

  • Surviving spouse of an ex-military personnel.
  • Current or ex-military personnel.
  • Served 90 or more days on active duty during war time or 181 days in peace time and were honorably discharged. This is waived if you were discharged due to a service-related disability.
  • Served in the National Guard for six or more years.
  • Have no money for a down payment but can make the monthly payments.
  • Want a loan with no PMI (Private Mortgage Insurance).
  • Need fewer credit restrictions.
  • Need seller Assistance up to 4% of the purchase price.
  • Easy refinancing with the VA Streamlined refinances program.
  • Need additional funds to make energy or other home improvements after purchase.
  • You have a minimum credit score of 620

Interest Only Mortgage

In an interest-only mortgage, you pay only interest on your mortgage for a specific period of time (typically 5-10 years) while your principal remains unchanged. This reduces your monthly payments and allows you to afford a more expensive home, as well as diverting the portion of the payment that would pay the principal to other uses, such as increasing retirement savings or paying for college.  Is an interest-only mortgage for you?  It might be if you…

  • Disciplined saver and money manager.
  • Have an income that will rise over time and are not concerned about higher payments at the end of the interest-only period.
  • Like the flexibility to be able to pay principal by paying more than the minimum required payment – on your schedule and within your budget.
  • If you want to purchase a more expensive home now.
  • Would like to invest in things other than the equity in your home.
  • Wish to maximize cash flow on investment properties.

Guaranteed Rate Mortgage Process, Pros & Cons

Guaranteed Rate’s web site is short on explanation about the process, but it is easy to use.  There is a comprehensive “Knowledge Center”, in which you can read articles about various aspects of the process, and an extensive set of calculators for payment calculations, whether to get a 15 or 30 year loan, whether to refinance, how much home you can afford, whether to make extra payments, and a host of others.  There is also a section with numerous articles targeted to “after you purchase your home).

Guaranteed Rate Mortgage Process

The following description of the process could be useful, considering that the process is more or less the same across lenders and technology platforms:

  • Get organized – track down your income documentation, bank statements and other legal documentation that will be needed during the process.
  • Think about your budget – start with your salary, self-employment or other income, multiplying it by 29%. The goal is that your total housing expense would not exceed 29% of your gross income.  In fact, the agencies and Guaranteed Rate will approve loans with housing expense greater than 29% of your monthly gross income, but that is a good place to start.  At this point, engage the services of a professional loan officer, who can help guide you through income qualifying.
  • Use Guaranteed Rate’s proprietary “Intuitive Loan Finder” to find the best loan for you.
  • Apply for a mortgage and get pre-approved, using Guaranteed Rate’s “World’s First Digital Loan” platform or its mobile platform. As part of this process, you will see all three of your credit scores, receive your Fannie Mae DU or Freddie Mac LP electronic approval and securely upload and digitally sign your documents.  This will tell the seller you are serious and will assure the seller that you will be able to close on the agreed terms.
  • If you have time and need the tightest possible pre-approval and shortest close, use the Red Arrow Approval Express Program and have your application underwritten by a live underwriter before you get into contract. This will help get your offer accepted in highly competitive markets.
  • Prepare for the appraisal, processing and underwriting of your loan. Most of this work is done by Guaranteed Rate, with you supplying documentation as it is requested.
  • Your loan goes for final approval and if approved, you will sign the final closing documents using Guaranteed’s “Flash Close” digital signing platform, and then you close.

Guaranteed Rate Mortgage Process, Pros & Cons

Guaranteed Rate’s web site is short on explanation about the process, but it is easy to use.  There is a comprehensive “Knowledge Center”, in which you can read articles about various aspects of the process, and an extensive set of calculators for payment calculations, whether to get a 15 or 30 year loan, whether to refinance, how much home you can afford, whether to make extra payments, and a host of others.  There is also a section with numerous articles targeted to “after you purchase your home).

Guaranteed Rate Mortgage Process

The following description of the process could be useful, considering that the process is more or less the same across lenders and technology platforms:

1. Get organized – track down your income documentation, bank statements and other legal documentation that will be needed during the process.
2. Think about your budget – start with your salary, self-employment or other income, multiplying it by 29%. The goal is that your total housing expense would not exceed 29% of your gross income.  In fact, the agencies and Guaranteed Rate will approve loans with housing expense greater than 29% of your monthly gross income, but that is a good place to start.  At this point, engage the services of a professional loan officer, who can help guide you through income qualifying.
3. Use Guaranteed Rate’s proprietary “Intuitive Loan Finder” to find the best loan for you.
4. Apply for a mortgage and get pre-approved, using Guaranteed Rate’s “World’s First Digital Loan” platform or its mobile platform. As part of this process, you will see all three of your credit scores, receive your Fannie Mae DU or Freddie Mac LP electronic approval and securely upload and digitally sign your documents.  This will tell the seller you are serious and will assure the seller that you will be able to close on the agreed terms.
5. If you have time and need the tightest possible pre-approval and shortest close, use the Red Arrow Approval Express Program and have your application underwritten by a live underwriter before you get into contract. This will help get your offer accepted in highly competitive markets.
6. Prepare for the appraisal, processing and underwriting of your loan. Most of this work is done by Guaranteed Rate, with you supplying documentation as it is requested.
7. Your loan goes for final approval and if approved, you will sign the final closing documents using Guaranteed’s “Flash Close” digital signing platform, and then you close.

Guaranteed Rate Mortgage Process, Pros & Cons

Guaranteed Rate’s web site is short on explanation about the process, but it is easy to use.  There is a comprehensive “Knowledge Center”, in which you can read articles about various aspects of the process.  There is also a section with numerous articles targeted to “after you purchase your home).

Guaranteed Rate Mortgage Process

The following description of the process could be useful, considering that the process is more or less the same across lenders and technology platforms:

1. Get organized

track down your income documentation, bank statements and other legal documentation that will be needed during the process.

2. Think about your budget

start with your salary, self-employment or other income, multiplying it by 29%. The goal is that your total housing expense would not exceed 29% of your gross income.  In fact, the agencies and Guaranteed Rate will approve loans with housing expense greater than 29% of your monthly gross income, but that is a good place to start.  At this point, engage the services of a professional loan officer, who can help guide you through income qualifying.

You can use our extensive set of calculators determine which of the loans are better for you, whether to get an ARM or fixed rate mortgage, check your qualification chances, how much home you can afford, whether to make extra payments and more.

3. Use Guaranteed Rate’s proprietary “Intuitive Loan Finder” to find the best loan for you.

4. Apply for a mortgage and get pre-approved

Using Guaranteed Rate’s “World’s First Digital Loan” platform or its mobile platform. As part of this process, you will see all three of your credit scores, receive your Fannie Mae DU or Freddie Mac LP electronic approval and securely upload and digitally sign your documents.  This will tell the seller you are serious and will assure the seller that you will be able to close on the agreed terms.

5. Use the Red Arrow Approval Express Program

If you have time and need the tightest possible pre-approval and shortest close, use the Red Arrow Approval Express Program and have your application underwritten by a live underwriter before you get into contract. This will help get your offer accepted in highly competitive markets.

6. Prepare for the appraisal, processing and underwriting of your loan

Most of this work is done by Guaranteed Rate, with you supplying documentation as it is requested.

7. Your loan goes for final approval

and if approved, you will sign the final closing documents using Guaranteed’s “Flash Close” digital signing platform, and then you close.

Guaranteed Rate Mortgage: The Advantages

Guaranteed Rate is a proven leader in the mortgage lending arena, offers a couple of great advantages to borrowers:

  • Offerings for the entire spectrum of borrowers who meet the minimum credit score and have enough income to qualify: Conventional agency fixed rate, adjustable rate mortgages (Fannie Mae and Freddie Mac), Government guaranteed mortgages (FHA, VA), Conventional non-conforming (Jumbo) mortgages and Interest only loans
  • You can apply from any type of device, in person, or by phone.
  • Guaranteed Rate’s mobile app allows prospective borrowers who are comfortable using technology to complete the loan application process on their smart phone or another device. This allows a buyer to be pre-approved in minutes, rather than hours or days.

Guaranteed Rate Mortgage: The Disadvantages

  • Current turnaround times are 15 – 30 days, which can be a big plus in certain high-volume, high demand areas, where the housing supply is short.
  • Retail branch offices are in 50 states, but in some states, there is only one branch. Even if there is a branch with a local loan officer, a borrower soon ends up dealing with the company’s centralized operations.
  • Consumer reviews vary widely regarding Guaranteed’s Customer Service. The biggest issue seems to be that too many people are involved in the process, once the borrower has made an application.  Somehow the continuity seems to be lost between the loan officer and the funder, with many complaining about unnecessary delays, paperwork getting lost and unreturned phone calls.

Summary: Guaranteed Rate Mortgage

Guaranteed Rate is a major nationwide lender with a variety of loan options that can meet almost any customer’s needs.  It has a 50-state retail footprint.  Guaranteed has an abundant and robust online presence.   You can apply from your phone, your iPad, any mobile device, as well as your computer and conduct the entire process online.

In addition to home purchases, Guaranteed Rate also refinances properties – you can get a “rate and term” (also known as no-cash out) refinance, or you can take equity out of your home with a cash-out refinance. They do interest-only loans and construction loans, as well.

Guaranteed Rate is best suited for the borrower who can deal with technology and who meets reasonable standards for a credit score (620 – 740), can qualify based on their income and ability to demonstrate down payment and reserve requirements for Guaranteed Rate’s programs.  If you have low credit scores or unverifiable income, Guaranteed is probably not where you would go for your financing.