Connexus Credit Union offers great incentives to its members to take out a home mortgage with them. They offer conventional loans for bad credit and low down payment borrowers, they have various loan terms, and they offer ways to save money on closing costs.
On top of all that, Connexus Credit Union is already offering loans and services that match or surpass government-backed loans. All that’s required is you become a member, which is an easy thing to do.
Connexus Mortgage Application Requirements
Connexus Credit Union is more forgivable than many other lenders in that it only requires a 600 credit score from its borrowers. However, before you can borrow from them, you must first become a member. The easiest way is to make a one-time donation of $5 to the Connexus Association. However, there are also three other ways to become a member.
The actual mortgage application is very easy compared to other lenders. You will need to provide a photo ID, two years of tax returns, a W-2, and a pay stub, but from there, your work is practically done.
Connexus Credit Union uses a sophisticated underwriting system that enables them to request very little personal information from you to verify any entered data. Many people only have to enter a single W-2 form or pay stub (as opposed to several with other lenders). This expedites the whole process and makes it so you don’t have to go rummaging through old files underneath your bed.
Types of Home Loans Available from Connexus Credit Union
Unlike many other lenders, Connexus Credit Union does not offer FHA, VA, or USDA loans. However, don’t let that dissuade you from them. Their conventional loans come with a slew of options, and many of them are great alternatives to FHA loans.
Connexus Credit Union offers both fixed and adjustable-rate mortgages for either purchasing or refinancing. Their adjustable rate mortgages start relatively low compared to other lenders and are a great option if your new home purchase may not be your ‘forever’ home. They offer many packages to choose from, including 5/1, 7/1/ 10/1, 3/3, 7/3, and 10/3 ARMs.
They also offer three different packages for their fixed-rate loans (whereas most lenders only offer two. Choose a loan term of either 15, 20, or 30 years. If a fifteen-year loan term monthly payment is too high, you might very well be able to afford a 20-year term. Compared to 30, you’ll save thousands of dollars when paying off your home.
Many first-time homebuyers don’t even consider conventional loans because 1) their credit score is too low, and 2) they can’t make a sizeable down payment. However, Connexus lends to bad credit borrowers (600 credit score minimum) and offers conventional loans that only require a 3% down payment. Years ago, this was unheard of with non-government-insured loans. Now it’s a reality.
Because their loans aren’t government-backed, they don’t have to charge mortgage insurance for the life of the loan. However, since 2013, FHA loans require PMI payments for the life of the loan, regardless of how much equity the borrower has built up.
With a conventional loan through Connexus, you stop paying for mortgage insurance once you reach 20% equity. This is something to keep in mind in today’s housing market, where house prices are jumping because of a lack of supply and new trade tariffs.
Because house values are rising so fast, all it often takes is a new appraisal to show that you have more than 20% equity built into your house. For many borrowers right now, this is happening after just a couple of years. Again, you can’t avoid these payments with an FHA loan.
If you’re buying a home that’s more than $453,100, you’re going to need a jumbo loan, which Connexus indeed offers. Jumbo loans are generally needed most in high-cost areas. You’ll have to look up your area’s loan limits to know what purchase price exceeds the standard maximum.
Home Equity Loans & HELOCs
With a home equity loan or a 5/1 arm, you can borrow up to 90% of your home’s equity and get all the money at signing. With a home equity line of credit (HELOC) or interest-only HELOC, you can borrow as needed up to your line of credit limit.
Fees and Rates
Connexus Credit Union always posts current mortgage rates online. Tell them where you plan to purchase, the loan amount, and the main property use, and Connexus will give you the current interest rate for the loan you’re seeking.
You will pay third-party fees (such as appraisal fee, inspection fee, title insurance fee, and credit report fees) when closing, but this isn’t money that goes to Connexus. Instead, it’s money that Connexus will pass on to the actual company that performed the particular service.
Once you have a mortgage with Connexus Credit Union, there are fees when making payments online or over the phone (rather than mailing in your payment). If you pay online, there is a convenience fee of $9.95; if over the phone, $14.95.
Though it seems odd that any company with a solid online presence would charge a convenience fee for paying any other way than mail in a check, it’s common for many lenders to do this.
Connexus Credit Union’s Mortgage Process
You can apply online or call to get started. Like its competitors, Connexus has beefed up its online loan platform for mortgage applications. It’s intuitive, educational, mobile-friendly, and provides the following services:
- Personal loan management
- Free rate quotes
- Document uploads
Unfortunately, you can’t track your loan’s progress through the online portal, but that particular service is expected to roll out soon. In the meantime, each borrower is assigned a loan officer that works one-on-one with them until closing. Some people see this as a negative, but it adds a needed human element to what would otherwise be a stressful situation for most people.
Connexus Special Features
When you buy or refinance your home, Connexus Credit Union will take up to $600 off closing costs if the loan amount is $150,000 or more. So, for example, say your closing costs were approximately $5,000 for a $150,000 loan amount, you’d be saving 12% on closing. Just be sure to enter the promo code “SAVEONCLOSING” during the application process.
Another notable feature is that Connexus Credit Union will consider alternative credit data if your financial history is limited. This is good for people with bad credit because they’ve never had to take out a loan.
If credit bureaus factored in on-time monthly payments of rent and utility bills, many people’s credit scores would be much higher. Fortunately, CCU will take these types of factors into account when considering a loan application.
Connexus Credit Union Mortgage Reviews
One of the best ways to research mortgage lenders is by reading third-party reviews. You can discover what actual customers are saying about them before you choose to do business with them.
Connexus Credit Union’ currently has a Better Business Bureau (BBB) rating of A+, indicating excellent customer service. They also have very few complaints. You can find more Connexus Credit Union reviews at other review sites as well.
Because Connexus Credit Union doesn’t offer government-insured options, many people think that it can’t be a major player in the lending world. This isn’t true. Considering that Connexus Credit Union offers loans for poor credit and low down payments, it becomes evident that CCU has maneuvered itself into an excellent position with informed borrowers.
If you’re just starting your house hunt, keep Connexus Credit Union on your shortlist for lenders. It offers many conventional loans that are as good, if not better, than FHA’s.