U.S. Bank Mortgage Review: Wide Variety, Low Rates, Great Service

U.S. Bank is a nationwide mortgage lender with a large branch network. This lender comes to the table with a great reputation for customer service, a few harder-to-find mortgage loan options, and a significant discount off mortgage closing costs for eligible current U.S. Bank customers.

Check out our U.S. Bank Mortgage review to see if this is the best mortgage lender for your next home loan.

This mortgage lender is a good fit for: Current U.S. Bank customers and borrowers looking for down payment assistance. U.S. Bank is also a great option for someone looking for a construction loan or a mortgage for an investment property.

Top perks 

Reputation

U.S. Bank scores well above average in the J.D. Power 2023 U.S. Primary Mortgage Servicer Satisfaction Study, with 623 points versus the industry average of 601. This indicates customers tend to have a good experience when U.S. Bank services a loan. U.S. Bank also scores well in J.D. Power's mortgage origination study (730, which is the industry average). It's a great score; the competition is stiffer when it comes to making new loans.

Customer discount 

U.S. Bank offers a relationship bonus to its current customers. If you hold a U.S. Bank Smartly® Checking account or an existing Gold or Platinum Checking Package, or you have an existing U.S. Bank first mortgage, you may be eligible for a discount on closing costs. The discount is 0.25% of the new loan amount, up to a maximum of $1,000. For example, if your loan is for $200,000, you can save $500.

Five-minute prequalification 

You can enter your personal information on U.S. Bank's website and get a basic home loan estimate. It takes about five minutes, and the response is instant. This isn't a full application and won't affect your credit score. It's also not a commitment to lend, but it can let you know where you stand. 

Loan variety

U.S. Bank offers most popular mortgage loans, as well as some that can be harder to find:

• Conventional loan
• FHA loan
• VA loan
• Jumbo loan
• Home equity loans and home equity lines of credit (HELOCs)
• Fixed-rate mortgage
• Adjustable-rate mortgage
• Construction loan
• Lot loan
• Investment property loan

Physical branches

Sometimes you might prefer to do business in person. That's understandable when we're talking about a home, possibly the biggest purchase you'll ever make. Not everyone is comfortable handling major financial conversations and transactions remotely. U.S. Bank has branches in 26 states, so there might be one near you.

Down payment assistance

Most down payment assistance programs are offered by your state, county, or city. It can be difficult to learn where to find and apply for help. U.S. Bank says its loan officers can guide you through the process.

What could be improved 

Transparent lending information

U.S. Bank Mortgage doesn't publish details about what it looks for in an applicant on its website. Also, U.S. Bank Mortgage says it works with various agencies to help borrowers get down payment assistance, but there's no specific information about this. For example, a borrower will have to speak to a loan officer to find out how to qualify and what the minimum down payment might be. Not everyone wants to start their mortgage loan research with a call from a loan officer (and their name on a marketing list). Admittedly, U.S. Bank is not unusual in this.

Published rates won't apply to most borrowers

All lenders keep their best rates for the most qualified applicants, and in general, consumers with excellent credit scores will get the lowest mortgage rates. Each lender sets its own cutoff between "good" and "excellent." U.S. Bank Mortgage says that 740 is an excellent credit score. 

As such, you'll likely need a credit score of at least 720, perhaps even 740, to land in that low mortgage rate sweet spot. Since the average credit score in the U.S. is 711, the published rates on U.S. Bank's website won't apply to most people.

One of the first steps in applying for a home loan is to check your credit score and credit reports. With a bit of legwork, you'll be better prepared and have a bigger chance of success. 

The main things the lender will look for in your loan application are your existing debt, your income, your credit score, and your down payment (or equity, if you're doing a mortgage refinance):

• Debt-to-income ratio (DTI): U.S. Bank wants your DTI to be no higher than 45%. That means your required monthly debt payments, including the payment for the desired mortgage, can't exceed 45% of your income. Because of a 2021 mortgage rule change at the federal level, many lenders now allow a DTI of 50%, so you may be able to get away with a DTI higher than 45% depending on your other circumstances.
• Income: If you have pay stubs and tax returns to show sufficient income, you'll qualify for more loan programs. That doesn't mean gig workers and self-employed people are out of luck. However, if you need to document your income in a nontraditional way, you may need to find a lender that offers a certain type of non-QM loan. U.S. Bank Mortgage does not advertise this kind of non-QM loan (often called a stated income loan).
• Credit score: For a conventional loan at U.S. Bank Mortgage, you need a minimum credit score of 620. When you speak to lenders, it's also worth asking what credit score you'd need to get a lower rate. If you find out you're near the next level, consider taking steps to improve your credit before you apply. A lower rate could save you a significant amount of money over the life of the loan. 
• Down payment: A down payment of 20% or more on a conventional loan will allow you to avoid private mortgage insurance. A bigger down payment also means you can borrow less and get out of debt sooner. If 20% is too high, don't stress; you might still qualify with less money down. At U.S. Bank Mortgage, the average down payment is 11% for a first-time home buyer.

If you're a U.S. Bank customer be sure to tell your loan officer about your existing accounts in case you can qualify for the discount on closing costs.

U.S. Bank Mortgage's refinance rates are competitive. They may look higher than the national average, but that's because they might not reflect mortgage discount points. Some other lenders advertise lower rates but hide a fee in the footnotes. U.S. Bank notes on its website that you might be able to get a lower rate by purchasing discount points.

The advertised conventional mortgage rate at U.S. Bank Mortgage usually trends about the same as the national average. It's nice that U.S. Bank publishes all of the best rates for its loan types clearly on its website. Like the refinance rates, the purchase rates advertised may not reflect mortgage discount points, so you could get a lower rate if you are willing to pay a little more upfront.

U.S. Bank Mortgage offers competitive rates on a range of mortgage loans and is a great choice for existing U.S. Bank customers who qualify for the closing cost discount. It's also a good place to shop for niche mortgage products such as a construction or lot loan, or an investment property loan. And if you're having a hard time getting over the down payment hurdle, U.S. Bank Mortgage promises to help navigate down payment assistance programs.