Ally Mortgage Review: 100% Online Application

Ally offers multiple loan options for qualified borrowers, most with competitive rates. This includes options for first-time borrowers looking for low down payment loans. Ally's application process is 100% digital, and loan approval occurs faster than most competitors. Unfortunately, government-backed loans aren't available. So those looking for easy qualifying requirements may not find as many options. Read our full Ally Mortgage review to learn more.

This mortgage lender is a good fit for: Borrowers with a good or excellent credit score who are interested in applying online for a fixed-rate, adjustable-rate (ARM), or jumbo loan.

Top perks 

Find the right loan fast

You'll get a personalized quote after answering a few simple questions -- and a pre-approval letter to include with your home offer after just three minutes. Ally provides a table showing different mortgage types, possible interest rates, and monthly mortgage payments so you can decide at a glance what's right for you.

Fully digital process

While loan officers are available via text or phone if you need help, you can apply and submit all your financial documentation online. 

Low down payments and first-time buyer programs

You can make a down payment as low as 3% and save on private mortgage insurance with Fannie Mae's HomeReady loan option. 

What could be improved

Must close in person

While the application process is 100% digital, Ally requires in-person closings for all of its loans.

Strict requirements for jumbo loans

Not every mortgage lender offers jumbo loans. So while it's definitely a positive that Ally has this loan type in its lineup, the lender does require a 20% down payment. Since jumbo loan amounts are meant for higher-priced homes and exceed conforming loan limits, you're going to be looking at a rather large out-of-pocket amount to come up with a 20% down payment.

Ally also requires first-time home buyers to show they have cash reserves of at least 12 months before qualifying for a jumbo loan.

Limited options for low credit

Ally doesn't offer many mortgage options for borrowers with low credit scores. That means you won't find the following government-backed loans, which come with less restrictive eligibility requirements:

• FHA loans
• USDA loans
• VA loans

Ally considers these four primary factors when determining if you'll be approved for a home loan:

• Your credit score: Unlike some lenders, Ally doesn't offer many options for borrowers with poor credit. Although Ally does not disclose a specific minimum score on its website, it indicates lenders generally require a credit score of 640 credit score for most loans and 700 for jumbo loans.
• Debt-to-income ratio (DTI): Ally will compare your gross monthly income to the total amount of your monthly debt payments (including mortgage costs for your new loan). Your debt-to-income ratio (DTI) should be below 43%, but keeping this ratio as low as possible will maximize your chances of getting approved at a competitive rate.
• Down payment: Ally offers some home loans with a down payment of as low as 3%. However, others -- such as jumbo loans -- require a minimum down payment of 20%.
• Employment history: You'll need proof of income showing you have a steady job and money coming in that you can use to pay your monthly mortgage bill.

You can submit all of the required documentation online. Ally will likely ask for recent pay stubs, employment records, tax returns, and bank statements. Depending on your situation, you may also need to provide other proof of income and assets, verification of on-time rent payments, a letter explaining gaps in employment, and a divorce or separation decree.

Ally's application for a mortgage refinance can also be done completely online. We found the lender's refinance rates to be competitive with the national average. Ally also promises to close on your loan quickly -- 10 days faster than the national average.

Ally's mortgage rates on its website are competitive, with some posted rates coming in a bit below the national averages. Ally offers both fixed- and variable-rate options, and its rates are the lowest on loans with shorter payoff timelines.

Ally Mortgage is a good choice if you are a well-qualified buyer interested in applying for a fixed-rate loan, ARM, or jumbo mortgage online. You'll need a minimum down payment of 20% for a jumbo loan, but you can qualify with as low as 3% down for some loans as a first-time buyer. You'll need to close in person, but will appreciate the convenience of submitting all your documents online and getting pre-approved within minutes.