Better.com is a one-stop shop for all your mortgage needs. The online lender provides an exceptional online lending experience and goes a step further to assist you with securing a real estate agent, title insurance, and homeowners insurance for your new home.
You can find some of the most competitive mortgage rates in the industry from Better.com. Plus, their dedicated team will help you find the most ideal solution, minus all the lender fees that other lenders saddle their borrowers with.
Keep reading to learn more about this online lender’s application requirements, offerings, process, and what makes them stand out amongst the competition.
Better.com Mortgage Application Requirements
The mortgage application process for Better.com varies by loan product and your financial situation. Prepare to provide the following documents before you apply:
Income Documentation
- Salaried income individuals or wage earners: most recent pay stub, W2 statements for the past year, most recent personal tax return
- Restricted Stock Unit (RSU) income earners: written verification of employment from your employer that confirms employments for the past 2 years, RSU agreement for the next 3 years
- Self-employment income: 1099 statements for the past 2 years, 2 years of business tax returns, year-to-date profit and loss statement, K-1 statements (for partnership and S-Corporation owners)
- Rental income from investment properties: signed lease agreement and most recent personal tax return
- Child support/alimony recipients: most recent personal tax return and copy of divorce decree
- Fixed income recipients: bank statement that shows recent benefits, most recent tax return, award letters for Social security, pension or disability income
Debt Documentation
A loan officer will pull your credit report to review information about your debts. Additional documentation may be required if you:
- Recently opened any accounts that haven’t yet been reported to the credit bureaus
- Have adverse information on your credit report
- Own other properties
- Are divorced and have recurring payments under your divorce decree
Better.com has a minimum credit score requirement of 620 and a minimum down payment of 3%. You may qualify for a mortgage with a debt-to-income (DTI) ratio of up to 50 percent. However, a lower DTI could increase your approval odds for more attractive financing options.
Asset Documentation
- Two months of bank statements
- Documentation for large deposits or payments
- Withdrawal terms if you’re using funds from a retirement account for the purchase
Also, confirm Better.com is eligible to do business in your state before inquiring about a home loan. Better.com is licensed to originate loans in the following states:
Alaska, Alabama, Arkansas, Arizona, California, Colorado, Connecticut, District of Columbia, Delaware, Florida, Georgia, Iowa, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maryland, Maine, Michigan, Mississippi, Missouri, Montana, North Carolina, North Dakota, Nebraska, New Jersey, New Mexico, New York, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Washington, Wisconsin, West Virginia, and Wyoming.
Types of Home Loans Available
If you’re looking for government-backed mortgage products, like FHA loans, USDA loans, or VA loans, Better.com isn’t a good fit. They only offer conventional and jumbo loans. The good news is their loan products boast some of the lowest rates in the industry.
Here’s a complete list of Better.com’s mortgage offerings:
Conventional Mortgages
Conventional loans or conforming fixed and adjustable-rate mortgages (ARMs) are available on the following properties:
- Single-family homes
- Multi-family homes (capped at four units)
- Condominiums
- Townhomes
- Planned United Developments
Conventional loans are available for 15, 20, and 30-year terms. Qualification criteria vary by loan product, but your mortgage rate and monthly mortgage payment (for principal and interest) will remain the same over the life of the loan if you go with a fixed-rate mortgage.
By contrast, ARMs come with a fixed interest rate for a short period, followed by a fluctuating rate. This means your payment could be significantly higher in the future. However, some borrowers get these loans to save in the beginning as the rates tend to be much lower – it may also mean that they qualify for a pricier home than they would with a conventional mortgage.
If you’re considering an ARM, conduct a cost-benefit analysis to ensure it’s worth it. It’s best to get an ARM only if you plan to refinance or sell the house before the lower interest rate expires.
Jumbo Mortgages
In the market for a higher-priced home that exceeds the conventional loan limit? Better.com may be able to assist with their fixed and adjustable-rate jumbo loans. They operate like conventional mortgages, but you may be required to make a larger down payment.
There are fixed and adjustable-rate loan products available. Also, know that Better.com features jumbo mortgages with 15, 20, and 30-year repayment periods.
Mortgage Refinancing
If your credit score has improved since you took out your original mortgage, you may be considering a refinance. This financial move can get you a more competitive interest rate or switch from an ARM to a fixed-rate loan to make your monthly payments more affordable.
Some homeowners also tap into their home’s equity through a cash-out refinance. Since the use of the funds is not dictated by the mortgage lender, you may decide to pay off debt or fund a major home renovation product with the money.
Mortgage refinancing may also be a viable option if you have extra cash on hand and want to pay off your mortgage faster by getting into a 15 or 20-year mortgage product. You could save several thousand in interest with this strategic financial move.
Fees and Rates
Better.com prides itself on making mortgage products more accessible to prospective homeowners from all walks of life. Not only are their rates extremely competitive, but they don’t charge all the mortgage fees that you’ll find with other lenders. This means you won’t pay application fees, processing fees, and underwriting fees, which could easily amount to thousands of dollars in closing costs and cost you a fortune out of pocket.
Furthermore, know that transactions are commission-free, and there are no loan origination fees. This alone is enough to give Better.com a shot at earning your business as origination fees are traditionally 1%. So, you’ll pay a whopping $3,500 alone in lender fees if your total purchase price is $350,000.
Better.com’s Mortgage Process
Better.com’s user-friendly online portal makes it easy to complete the entire mortgage process from the comfort of your home. The loan portal is accessible 24/7, which means you can get started any time of the day or night and check the status of your application when it’s convenient.
When you’re ready to get started, select the button from the home page and indicate if you’re buying or refinancing a home. Based on your selection, you will be prompted to enter the application needed to receive a lending decision. Most pre-approvals are issued in as little as 3 minutes.
Documents can be uploaded directly through the online portal. You can also e-sign most forms, link bank accounts, and sync tax return preparation software to make it easier for the mortgage lender to access the forms and information they need. Plus, you won’t have to chase down and send in mountains of paperwork.
If you have questions or need assistance, you can reach a representative at 415-523-8837 or send an email to hello@better.com. Someone is standing by 7 days a week from 9 am – 9 pm EST to assist.
Better.com Special Features
Beyond the absence of the commissions and excessive fees many mortgage lenders charge, this direct lender also offers a Better Price Guarantee. They will match an eligible competitor’s offer (by $100 lower) or give you $100 if they can’t get the job done.
The Better Real Estate program is another option to save even more on your transaction. If you use an agent from the Better Real Estate network and complete your transaction through Better Mortgage Corporation, you could qualify for $2,000 in lender credits.
When it’s time to close on your loan, you can work with Better Settlement Services to secure title insurance. And you don’t have to spend hours searching for the perfect homeowners’ insurance – Better Cover will help you sift through the assortment of quotes to find the most suitable option.
Better.com Mortgage Reviews
Better.com has received a mix of customer reviews, highlighting both positive and negative aspects of their mortgage services. On the positive side, many customers appreciate the fast and efficient process, citing a seamless online experience and quick response times. The platform’s user-friendly interface and transparent rates and fees are also frequently praised.
On the other hand, some customers have experienced communication issues with loan officers, leading to delays or confusion during the mortgage application process. Additionally, a few customers have reported inconsistencies in the loan terms offered, causing dissatisfaction.
Better.com currently has a Better Business Bureau (BBB) rating of A, which is an indicator of great customer service. They also have very few complaints. You can find more Better.com reviews at other review sites as well.
Bottom Line
If you’re in the market for a conventional or jumbo loan, Better.com is worth considering. Their rates are affordable, and you won’t spend a fortune on pesky fees.
What’s even more impressive is their comprehensive suite of products that can help you find the perfect home and mortgage that works for your finances. And you won’t have to waste time looking for title and homeowners insurance as Better’s sister companies have you covered.