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New American Funding could be a great fit for self-employed borrowers, since it offers non-QM mortgages that you can’t get from all lenders. Another strength worth mentioning is New American Funding’s focus on helping people in underserved communities become homeowners.
New American Funding was the 16th largest mortgage lender in the U.S. by loan volume in 2018, making $10.1 billion in loans. Headquartered in Orange County, CA, the family-owned business was founded by a wife-and-husband team in 2003. New American Funding now offers mortgage loans throughout the country and employs more than 3,000 people nationwide.
Use our New American Funding mortgage review to help you determine if this is the right lender for you.
Low rates and a diverse set of loan terms and products are a rare combo. A guaranteed fast closing simplifies the homebuying process.
Variety of loan products: In addition to the standard loan offerings you'd expect, New American Funding also offers several other special types of mortgage loans, including:
14 Business Day Close Guarantee: New American Funding offers some borrowers a guarantee that it will close on their loan in 14 business days or give $250 towards their closing costs. This is significantly shorter than the 40-day industry average. The guarantee only applies to purchase loans, and not to brokered loans.
First-time home buyer resources: New American Funding connects first-time home buyers with resources that can help make home ownership a reality. If you want to get a home with little or no money down, New American Funding can point you to down payment assistance and grant programs that might be available in your area.
High allowable DTI: New American Funding can approve borrowers with a debt-to-income ratio of up to 50%, which is higher than some other banks allow.
Clear website: It's easy to find answers to many initial questions on the New American Funding website. Prominent buttons lead to helpful information about FHA loans, VA loans, USDA loans, cash-out refis and a mortgage calculator.
Bilingual customer service: New American Funding places a high priority on providing services in both Spanish and English in order to better serve the Latino community.
Opaque costs: Costs are notably absent from New American Funding's otherwise complete library of information. It would be nice to see this lender's current mortgage loan rates and lender fees without having to disclose an abundance of personal information. Unfortunately, you have to start an application to get those details. This is especially frustrating on a website that displays links such as "mortgage rates" and "get today's rates." In fact, on the New American Funding website, those links lead to sales lead capture pages. You have to enter some basic information about the loan you want and a way for the lender to contact you. Then, the first email from New American Funding includes a link to the online "quick application," or its pre-qualification tool. You'll have to provide your Social Security number and authorize marketing emails and phone calls as well as a soft-pull on your credit file. All of this, just to get basic information.
No home equity loan or HELOC: New American Funding does not currently offer either a home equity loan or a home equity line of credit. If you want to tap the equity in your home, you'll need to take a cash-out refinance or specialty loan. That's especially inconvenient for borrowers who want a HELOC in order to avoid borrowing even one dollar more than they ultimately need.
No fully digital application: New American Funding has an online portal where you can start and manage the application process and upload your documents, but underwriting is done by actual humans. Manual underwriting is good for borrowers who need special consideration. But other borrowers prefer a fully digital experience, with more automation and less human interaction.
The three main parts of your mortgage loan application are your credit score, your down payment, and your debt-to-income ratio.
Conventional loans at New American Funding require a FICO® Score of at least 620. If your score is below 620 but above 500, you can apply for an FHA loan.
The down payment requirement varies with the loan type. New American Funding offers many choices for borrowers looking for a low down payment mortgage.
|Loan Type||Down Payment Requirement|
|VA or USDA loan||No down payment.|
|Conventional 97 loan for first-time homeowners||3% down payment, but money can come from gifts and grants, including homeowner assistance programs.|
|FHA loan||3.5% down payment if your credit score is above 580 and 10% if your score is between 500 and 579.|
|Regular conventional loan||At least 5% down payment.|
|Jumbo loans||At least 10% down payment.|
The debt-to-income (DTI) ratio is a figure all mortgage lenders look at. It is the sum of all of your required monthly debt payments (including the housing payment on the home you want to buy) expressed as a percentage of your gross (before taxes) income. Only the required minimum monthly payments that appear on your credit report will be used in the calculation. At New American Funding, your DTI can be no higher than 50% (28% without the proposed housing expense).
New American Funding will need your recent tax returns, bank statements, pay stubs, and other documentation, so be prepared to link your accounts or upload copies.
Axos Bank discloses its mortgage lender fee ($995) and promises to waive it for existing customers who borrow at least $250,000. For smaller loans, Axos offers a $200 lender fee discount. Borrowers who aren't currently customers can still qualify by opening a new account during the application process.
PNC Bank still offers a home equity line of credit (HELOC), unlike many major lenders who have temporarily suspended applications for home equity credit products. Rates are disclosed online without requiring any personal information.
You're self-employed. Check out New American Funding's non-qualifying mortgage loan when you shop around. Loan officers here are familiar with the qualification process if you don't have W2 income.
You want a USDA loan. New American Funding is a USDA lender and can help you navigate the process.
You're in an underserved community or demographic. New American Funding's goal is to take mortgage education into underserved communities and "help all perspectives be represented as homeowners."
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