NASB Mortgage Review: More Borrowers Can Qualify Here

NASB (pronounced "NAZ-bee") is a Kansas-City-area bank that offers mortgage loans in every state except New York. This lender offers far more than the standard menu of typical home loan options, including specialty loans that can suit just about any borrower's needs. NASB isn't a giant in the mortgage business, but because of the number of ways it accommodates hopeful home buyers, NASB Mortgage should be on your shortlist for consideration. Read our full NASB Mortgage review to find out if this is the best mortgage lender for you.

This mortgage lender is a good fit for: Any borrower who might not qualify for a traditional conventional mortgage loan. NASB is also a great choice for people who qualify for a traditional loan and are shopping for low costs.

Top perks

Home loan options for borrowers in many situations

The best thing about this mortgage lender is its ability to match borrowers with a home loan that works. Besides the usual conventional loan, FHA loan, and jumbo loan, NASB offers a number of harder-to-find home loan options and nontraditional mortgages.

Loans for unconventional earners

NASB offers customized loans for unconventional earners, bank statement loans for primary residences, and a program for new home buyers that can help cover most (and sometimes all) of the down payment.

Mortgage for borrowers with past credit issues

The non-conforming loan program at NASB is for borrowers who don't meet conforming loan guidelines -- for example, someone with a recent job change. This is also a good option for self-employed borrowers who have been in the same line of business for at least a year.

Another option is the NASB FLEX loan, which has a shorter waiting period after bankruptcy or foreclosure than conforming loans do. NASB says it can count virtually any assets you hold as an income source to qualify for this loan.

Mortgage for self-employed borrowers

The NASB Bank Statement mortgage is a stated income loan for borrowers who would rather document income with bank statements rather than tax returns and pay stubs. This is a great program for self-employed borrowers who have plenty of cash flow, but whose taxable income is too low to qualify for a traditional mortgage. That can happen, for instance, when business owners take legitimate deductions to reduce tax liability.

Similarly, the portfolio loan options at NASB allow the underwriter to look at all income streams and use more flexible guidelines. A "portfolio loan" is one that the lender does not intend to sell on the secondary mortgage market. The lender keeps it in its portfolio (hence the name). Since the lender plans to keep the loan, it doesn't have to check certain boxes that make the loan more sellable. A NASB portfolio loan is a good option for foreign nationals, borrowers with high income but low credit, and borrowers with high net worth but low income.

Self-directed IRA loan

If you have a self-directed IRA, you can use it to buy a home. The IRA itself will be the borrower. This type of loan favors you, because even though you are the IRA account holder, you are not personally responsible for the debt. If the loan goes into default, the lender can foreclose on the home and pursue the assets in the IRA, but can't go after your other assets. (In a rising market, lenders usually recover their losses by selling the home. Sometimes, however, selling the home is not sufficient.) A self-directed IRA mortgage is a way to use your IRA to invest directly in real estate, which is not permissible with a 401(k).

Good Neighbor loan

NASB makes a special effort to help Kansas-City-area residents achieve the dream of homeownership. The Good Neighbor loan requires a minimum credit score of 580, much lower than what's required for most conventional loans. Qualified borrowers can get a credit to help with closing costs. This is not the same program as the HUD Good Neighbor Next Door program for first-time home buyers and public servants.

VA loan

The VA loan is for borrowers who have served in the military, and some military spouses. A few other people can also qualify, such as those who were cadets at a military school. If you are eligible, you can get a mortgage with no down payment and no mortgage insurance.

Bridge loan

A NASB bridge loan helps you finance your new home before you complete the sale of your old home.

Outstanding customer service

NASB Mortgage has a great reputation. This lender is holding strong with a 4.96-star rating on Zillow, and an A+ with the Better Business Bureau.

Flat-rate origination fee

Some lenders charge an origination fee equal to a percentage of your loan amount. This fee can be as high as 3%. NASB Mortgage charges a flat fee of $995 ($0 for VA loans).

What could be improved

No USDA loan

A USDA loan is a government-backed mortgage that helps low- and moderate-income borrowers get a home with no down payment. Eligible properties are usually rural. It's one more path to homeownership for borrowers who struggle to meet the requirements for a conventional mortgage. NASB serves a large geographical area where properties are USDA-eligible, so it would be helpful if it added this option to the menu.

Geographic limits on some loan programs

NASB's Good Neighbor program is wonderful, but it's only available to borrowers in the Kansas City metro area.

No home equity products

NASB is not currently accepting home equity line of credit (HELOC) applications. When that option opens back up, it is likely to be only for NASB bank customers.

There are many ways to qualify for a NASB Mortgage. Because the down payment is as low as $0 and the credit score requirements are flexible, the question may not be whether you qualify, but rather which loan best meets your needs.

Of course, not everyone gets approved for a mortgage. Furthermore, the better your credit score is, the less you pay. Even if you're excited to work with a lender that can help you buy a home, it's worth your while to check your credit score and review your credit reports. See if there is anything you can do in the next six to 12 months to bump your credit score into a higher tier. If you can shave even a quarter of a percent off the interest rate, you could save thousands of dollars or more over the life of your loan. Here's an example:

The bigger your loan, the more you save with a lower rate. Use a mortgage calculator to see what your costs might be over time.

The main parts of your application are your down payment (or equity), your credit score, and your debt-to-income ratio (how much of your income you spend on debt each month). Lenders can usually be flexible with one or two of these, but not all three.

You can get a loan from NASB Mortgage with a credit score as low as 580 and with a debt-to-income ratio as high as 55%. However, those don't apply to the same loan program. If you have a lower credit score, you will probably need a lower DTI to qualify. The opposite is also true. If you have a higher DTI or you need other flexibility, you may need a stronger credit score.

NASB offers competitive mortgage refinance rates. When we checked, the 30-year mortgage rate and 15-year mortgage rate were the same for a purchase loan or a refinance.

NASB's mortgage rates trend very close to the national average. You can usually get a lower rate by buying mortgage discount points. Points are prepaid interest. You pay a fee to permanently reduce the interest rate on your loan. If you plan to own the property for at least a few years, you could save money over the long term by paying for points. You might also be able get a lower rate by opting for a shorter loan term.

You might not qualify for a traditional mortgage. Its flexible and common-sense underwriting can qualify more borrowers. If you have a blemish on your credit history, you're short on down payment funds, or you need to qualify with nontraditional documentation, check with NASB before making your final choice.

You live in Missouri and you're looking for help to become a homeowner. You might qualify for a forgivable loan (meaning you don't have to pay it back) to cover the down payment.