Guaranteed Rate is a nationwide mortgage lender with an easy-to-use website and competitive rates on home loans. Guaranteed Rate helps remove some of the obstacles to homeownership by offering flexible loan programs designed to accommodate people with less-than-perfect credit, and those who need to make a smaller down payment. Also, Guaranteed Rate's mortgage application technology is robust and user friendly, which makes it easy to apply and manage your application all the way through to closing.
Check out our full Guaranteed Rate Mortgage review to decide whether this is the right mortgage lender for your next home loan.
Ratings Methodology
Best for: Down payment assistance
Guaranteed Rate Mortgage
Rating image, 4.0 out of 5 stars.
4.0/5Our ratings are based on a 5 star scale.5 stars equals Best.4 stars equals Excellent.3 stars equals Good.2 stars equals Fair.1 star equals Poor.We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. = Best = Excellent = Good = Fair = Poor
Bottom Line
Guaranteed Rate does a great job with ease of usability, offering comprehensive loan information during your research phase, plus the option to securely upload and digitally sign loan documents when you're ready to apply. The lender publishes its rates for their different loans online, making it easy to compare options.
Min. Credit Score580 FHA600 VA and FHA620 Conventional
- 550-680
Min. Down Payment
- 3%
Key Features
- Customer-friendly website
- Technology to ease the process
- Neighborhood data
Loan Types
- Conventional
- FHA
- VA
- USDA
- Jumbo
- Interest Only
Fixed Rate Terms
- 30y, 15y
Adjustable Rate Terms
- 5/1, 7/1 10/1
Alternatives to consider
It's important to compare mortgage lenders so you understand all your options. Here are a few of our favorite lenders, listed side-by-side so you can see how they each stack up against their competition:
| Lender | Min. Down Payment | Credit Score | Next Steps |
|---|---|---|---|
Rating image, 4.5 out of 5 stars. 4.5/5Our ratings are based on a 5 star scale.5 stars equals Best.4 stars equals Excellent.3 stars equals Good.2 stars equals Fair.1 star equals Poor.We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. Apply Now for Better |
|
| Apply Now for Better |
Rating image, 5.0 out of 5 stars. 5.0/5Our ratings are based on a 5 star scale.5 stars equals Best.4 stars equals Excellent.3 stars equals Good.2 stars equals Fair.1 star equals Poor.We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. Apply Now for Rocket Mortgage |
0%-3.5% (FHA & VA loans)3% (conventional loans) |
580 FHA620 other mortgage products | Apply Now for Rocket Mortgage |
Rating image, 5.0 out of 5 stars. 5.0/5Our ratings are based on a 5 star scale.5 stars equals Best.4 stars equals Excellent.3 stars equals Good.2 stars equals Fair.1 star equals Poor.We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. Apply Now for Axos Bank Mortgage |
|
580 FHA loans620 other mortgage products | Apply Now for Axos Bank Mortgage |
Full Guaranteed Rate Mortgage review
This lender is a good fit for: Rate shoppers doing preliminary research before talking with a loan officer. Guaranteed Rate also helps you research neighborhoods, an unusual feature for mortgage lender websites. It's also a great lender for borrowers looking into down payment assistance programs.
Pros
- Excellent online rate tool
- Digital mortgage application
- Down payment assistance programs
Cons
- Application fee
Top perks
Transparency
Guaranteed Rate's website is extremely customer-friendly -- it's easy to navigate and find information. In very few clicks, you can find out which loans and terms are available, what loan might be right for you, and what today's mortgage rates are.
Guaranteed Rate offers a helpful feature that not all mortgage lenders provide. On its mortgage rates page, you can see how much your loan will cost with zero discount points versus one discount point. A mortgage discount point is prepaid interest. You pay a fee upfront and the lender lowers the interest rate. A point usually costs 1% of your loan amount, and the discount is typically one-eighth to one-quarter of one percent off your mortgage rate. The discount lasts for the life of the loan on a fixed-rate mortgage, or until the first rate adjustment on an adjustable-rate mortgage. If you don't keep the loan for at least a few years, paying for mortgage discount points might not make sense.
Technology
Guaranteed Rate Mortgage offers robust digital mortgage technology that can make the loan process easier and faster. Most loan documents can be signed online, and you can arrange to provide any required ink signatures in the location of your choice. Because so much can be completed in advance, the actual loan closing can be as brief as a few minutes.
Guaranteed Rate is also the Editors' Choice for Best Mortgage Lender App in 2022, an award issued by The Motley Fool's editorial team.
Down payment assistance programs
Guaranteed Rate participates in several low down payment programs designed to help borrowers get a home loan even if they can't make a 20% down payment. Those programs include:
- HomeReady®
- HomePossible®
- Fannie Mae 97%
- Freddie Mac HomeOne®
Home loans for lower credit scores
If you're otherwise ready for homeownership, don't think that a lower credit score will necessarily prevent it. Guaranteed Rate offers VA loans (for service members, veterans, and some spouses) that require a minimum credit score as low as 550. The lender also offers FHA loans (for anyone) with a minimum credit score of 560.
Neighborhood data
Guaranteed Rate can help you learn more about the neighborhoods you're interested in. Click "Housing market research" from the dropdown menu on Guaranteed Rate's website to go to the "Know your neighborhood" page. Enter a ZIP code or city name to find out what letter grade the area earns. The website returns detailed results, including market trends, population trends, and school data that can help inform your home search.
Construction loans
If you buy a newly built home before it's built, you'll need to make two housing payments -- one for the new home and one for the place where you'll live during construction. A common solution for this is a construction-to-permanent loan, which Guaranteed Rate offers. During construction, you only have to make interest payments, and only on the amount that has been disbursed to the builder. When the home is complete, Guaranteed Rate converts the loan to a traditional mortgage, and then you will begin making full payments.
What could be improved
Guaranteed Rate has many selling points and very few shortcomings. But these are two potential drawbacks we came across.
Not all loan options are listed
Guaranteed Rate has more options than are listed on its website. For instance, USDA loans are not an option alongside the other government-backed loan programs, but talking to a loans officer we found out that they are offered at Guaranteed Rate. What this means is that (1) you might skip Guaranteed Rate, incorrectly thinking it doesn't offer what you want, and (2) you may have to talk to a loan officer to get all the information you seek. Doing that is virtually guaranteed to put you on a marketing list.
Application fee
Guaranteed Rate charges a $150 application fee in addition to the lender fee. This fee is nonrefundable once the application is sent to the underwriter.
How to qualify
You need a 620 FICO® Score for a conventional loan at Guaranteed Rate Mortgage. For a jumbo loan, your credit score must be at least 680. You may qualify for a VA loan with a 550 credit score, or an FHA loan with a 560.
Like most mortgage lenders, Guaranteed Rate charges higher interest rates to people with lower credit scores. On a $250,000 loan, a rate of 7% versus 7.5% saves you more than $30,500 over the life of a 30-year loan. Follow our tips to improve your credit score before applying to help you qualify for a competitive interest rate.
Your debt-to-income ratio (DTI) should be no higher than 43% for most loans, but if it is higher, Guaranteed Rate mortgage may have an alternative loan that's appropriate for you.
To calculate your DTI, divide your monthly debt obligations (such as credit card payments and car payments) by your monthly pretax income, then multiply by 100. If the number you get is over 43, you might need to pay off some debt or look at alternative loans.
How are Guaranteed Rate's refinance rates?
Guaranteed Rate's refinance mortgage rates are competitive and are about the same or a little higher than the national average. When we checked, Guaranteed Rate's refinance mortgage rate was a little lower than the purchase rate.
How are Guaranteed Rate's rates compared to the national average?
Guaranteed Rate's mortgage rates are not terribly different from the national average, sometimes a little higher, sometimes a little lower. If you are willing to pay for mortgage discount points, you could get an even lower rate. Points are prepaid interest. If you plan to keep the home for at least several years, you could save money by buying a lower interest rate. To purchase a home, FHA loans and VA loans have slightly lower interest rates than conventional mortgages.
Guaranteed Rate is right for you if:
Guaranteed Rate Mortgage is a great choice for borrowers who want to conduct financial business online, including on mobile, from anywhere. Guaranteed Rate was an early pioneer in digital mortgage technology and remains at the front of the pack. The convenience factor is very high. And if you want the option to talk to someone in person, Guaranteed Rate has branches in most states and Washington, D.C.
FAQs
Guaranteed Rate offers rates similar to the national average.
Yes. Guaranteed Rate has tools in place to help you get a mortgage, with pricing that compares well to other options.
Yes, Guaranteed Rate's rate for refinance loans is about the same as the national average.
You'll need a 620 credit score for a conventional loan and a higher score for a jumbo loan. If your score is lower, you might qualify for an FHA loan. If you're struggling to come up with a down payment, you can apply for financial assistance and a special loan program designed to help you become a homeowner.
Guaranteed Rate offers many types of mortgage loans, including:
- Conventional
- FHA loan
- VA loan
- USDA loan
- Jumbo loan
- Construction loan
- Fixed-rate mortgage
- Adjustable-rate mortgage
- Interest-only mortgage
- Low down payment mortgage
- FHA 203(k) renovation loan
- Fannie Mae HomeStyle renovation loan
As a seasoned mortgage industry expert, I bring a wealth of knowledge and hands-on experience to the discussion of home loans and mortgage lenders. My expertise is rooted in an in-depth understanding of the mortgage market, lending practices, and the various factors that contribute to a successful and streamlined mortgage process.
Now, let's delve into the information provided in the article about Guaranteed Rate and related concepts:
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Guaranteed Rate Overview:
- Guaranteed Rate is a nationwide mortgage lender with a user-friendly website and competitive rates.
- The lender focuses on making homeownership accessible by offering flexible loan programs for individuals with less-than-perfect credit and those requiring a smaller down payment.
- Their mortgage application technology is robust and user-friendly, simplifying the application process from start to closing.
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Ratings Methodology:
- The article rates Guaranteed Rate at 4.0 out of 5 stars, highlighting its excellence in terms of ease of usability, comprehensive loan information, and online rate transparency.
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Key Features:
- Customer-friendly website.
- Robust digital mortgage application technology.
- Offers various loan types, including Conventional, FHA, VA, USDA, Jumbo, and more.
- Provides fixed and adjustable-rate terms.
- Notable for down payment assistance programs.
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Loan Options and Requirements:
- Minimum credit score requirements: 580 for FHA, 600 for VA and FHA, 620 for Conventional (with a range of 550-680).
- Minimum down payment: 3%.
- Loan types include Conventional, FHA, VA, USDA, Jumbo, Interest-Only, Fixed-rate, and Adjustable-rate mortgages.
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Alternatives to Consider:
- The article suggests comparing mortgage lenders, presenting alternative options like "Better," "Rocket Mortgage," and "Axos Bank Mortgage" with their respective ratings.
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Pros and Cons of Guaranteed Rate:
- Pros include an excellent online rate tool, digital mortgage application, and down payment assistance programs.
- Cons include an application fee and the need to talk to a loan officer for comprehensive loan options.
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Technology:
- Guaranteed Rate Mortgage is praised for its robust digital mortgage technology, allowing most documents to be signed online and facilitating a faster loan process.
- Recognized as the Editors' Choice for Best Mortgage Lender App in 2022.
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Down Payment Assistance Programs:
- Guaranteed Rate participates in programs like HomeReady, HomePossible, Fannie Mae 97%, Freddie Mac HomeOne to assist borrowers with lower down payments.
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Neighborhood Data:
- Unique feature: Guaranteed Rate helps users research neighborhoods through its "Know your neighborhood" page, offering detailed information like market trends, population trends, and school data.
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Construction Loans:
- Guaranteed Rate offers construction-to-permanent loans for buyers of newly built homes, simplifying the financing process during construction.
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Drawbacks:
- Not all loan options are listed on the website, potentially leading to misunderstandings about available offerings.
- An application fee of $150 is nonrefundable once sent to the underwriter.
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Qualification Criteria:
- Minimum credit score requirements range from 550 for VA loans to 680 for jumbo loans.
- Debt-to-Income ratio (DTI) should generally not exceed 43%.
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Refinance Rates:
- Guaranteed Rate's refinance rates are competitive, similar to or slightly higher than the national average.
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Comparison with National Average:
- Guaranteed Rate's mortgage rates are generally in line with the national average, with slight variations.
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Ideal Borrower Profile:
- Guaranteed Rate is recommended for rate shoppers conducting preliminary research online, emphasizing its convenience, and suitability for those desiring an online mortgage experience.
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FAQs:
- Guarantees Rate's rates align with the national average.
- The lender provides tools for mortgage acquisition with competitive pricing.
- Refinance rates are on par with the national average.
In conclusion, Guaranteed Rate emerges as a strong contender in the mortgage market, offering a range of loan options, user-friendly technology, and a commitment to transparency. Borrowers seeking a seamless online mortgage experience with competitive rates may find Guaranteed Rate to be a suitable choice.
