Flagstar Bank Mortgage Review for 2024

Flagstar Bank is a Michigan-based financial institution; however, they offer home loans across the country. With personalized service paired with digital application and tracking capabilities, they offer a solid blend of modern and traditional features.

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Plus, they have one of the widest offerings of mortgage products, especially for government-backed and construction loans.

Get ready to learn more about how to get a mortgage with Flagstar Bank.

Flagstar Bank Mortgage Application Requirements

Flagstar works with each applicant to determine what kind of loan they qualify for. However, because each type of loan comes with different credit score and income requirements, you’ll need to determine which one best suits your needs and financial situation. If you’re unsure about this, it’s smart to talk to a loan officer over the phone to help determine your best loan options.

Loan Types Available from Flagstar Bank

Flagstar Bank offers an incredible selection of mortgage products, making it easy to find exactly what you’re looking for. Here’s a brief overview of each type.

Fixed Rate Loans

A fixed-rate home loan is one of Flagstar’s most popular options. It’s entirely customizable, with available loan terms starting as low as eight years, up to the traditional 30-year mortgage. Flagstar offers 3% down payments on conventional loans for first-time homebuyers.

Once you close on your loan, your interest rate won’t change throughout the life of the loan. Therefore, your principal and interest payments also stay the same, so you know exactly what to expect from your monthly mortgage payments moving forward.

Adjustable Rate Loans

An adjustable-rate mortgage is just that — your rate can vary, which also changes your monthly payment. However, there are some limitations. Usually, you start with a fixed period, often set at seven years.

After that, your rate can adjust depending on where mortgage rates are, which can cause your payment amount to increase or decrease. Because of that added risk, you generally start with a lower mortgage rate than a fixed-rate loan would offer.

VA Loans

Flagstar Bank goes beyond the typical fixed-rate VA loan with zero down payments. In addition to this traditional mortgage, they also offer VA adjustable-rate loans that provide a fixed interest rate for either three or five years. If you already have a home, you can also take advantage of the VA Interest Rate Reduction Refinance. It doesn’t even require an appraisal in many cases.

FHA Loans

A comprehensive offering of FHA loans is another place where Flagstar shines. You can find FHA fixed rates, adjustable rates, 203(k) loans, and 203(h) loans. A 203(k) helps you finance a rehabilitation project of a newly purchased home, as long as it’s at least $5,000 of work and completed within six months.

A 203(h) is designed to help disaster victims replace severely damaged properties. You must take out the loan within a year of the president declaring the disaster.

USDA Loans

Flagstar Bank offers mortgages backed by the U.S. Department of Agriculture to finance new home purchases in rural areas. The property must be located in an eligible area, and you typically need to meet certain income restrictions based on where you live and the size of your family. The primary benefit of this is that there’s no required down payment.

Jumbo Loans

If you need a loan higher than a conforming loan allows, you can get a jumbo adjustable-rate mortgage through Flagstar Bank. Loan amounts range from $453,101 to $3 million. You can choose a fixed-rate period of either 5, 7, or 10 years before the loan switches to a variable rate. Flagstar typically requires a down payment of at least 10% for jumbo loans.

Professional Loans

This unique mortgage product is designed to help professionals recently out of school or otherwise early in their careers. It’s usually reserved for professions such as lawyers, doctors, architects, or accountants.

If you qualify, you’ll benefit from a low down payment and no required mortgage insurance. Plus, some of your student debt could be excluded from your debt-to-income calculations, which could help you qualify for a higher mortgage amount.

Construction Loans

Flagstar Bank stands out in that it has multiple options for construction and renovation loans. A general renovation loan lets you put some of the loan funds into an escrow account, from which you can pay contractors for work completed.

Anything leftover goes towards your principal payment. You can also finance a new-build home with an FHA construction-to-permanent loan, construction draw, or one-close loan.

Fees and Rates

Your mortgage rate with Flagstar Bank depends on several factors, including your credit score, type of loan, and down payment amount. As a transparent lender, Flagstar advertises its base APRs and lender fees for each loan type online. However, these can fluctuate, so it’s good to check back regularly while deciding on a mortgage lender.

Like most lenders, Flagstar charges a processing and underwriting fee as part of your closing costs. It typically amounts to about $1,000. You should receive an estimate of all associated costs when you apply for your home loan from any mortgage company.

Flagstar Bank’s Mortgage Process

To begin the application process for a Flagstar mortgage, you simply fill out a basic online form. You’ll be asked questions about the kind of mortgage you’d like, the home price, your credit type, and your personal information.

From there, one of their loan servicing professionals will reach out to talk to you and give you a quote on what kind of loan terms you can expect. There’s no hard credit pull, so you can get an informed idea of what interest rates and terms you qualify for without affecting your credit score.

After that, you can complete the application process either online or with your loan officer. Even steps like form signatures and document submission can be done digitally, and you can also track your loan’s progress online.

Flagstar Bank Mortgage Special Features

Refinancing, home equity products, and construction loans. Flagstar’s immense mortgage offerings are what truly sets them apart from the rest of the competition. While certainly capable of popular options like 30-year fixed and FHA loans, they also specialize in countless niche mortgages.

Whether you want an adjustable VA loan or new construction financing, you’re likely to find it at Flagstar Bank. And because they work on these specialty loans regularly, they can take you step-by-step through the process so you don’t encounter any unpleasant surprises along the way.

Flagstar Bank Mortgage Reviews

Many Flagstar Bank Mortgage customers appreciate the competitive interest rates and loan options available. Borrowers often mention that they were able to secure favorable terms that helped them save money over the life of their loan.

Additionally, several reviews highlight the bank’s commitment to a smooth and efficient application process. From pre-approval to closing, customers report feeling well-informed and supported throughout the entire mortgage journey.

Customer service is another area where Flagstar Bank often receives praise. Reviewers frequently mention responsive, knowledgeable, and friendly loan officers who took the time to answer questions and address concerns. This personal touch has led to many satisfied customers who felt that the bank genuinely cared about their financial well-being.

While many customers have positive experiences, some borrowers have reported issues in their mortgage process. These negative reviews often mention communication problems, such as difficulty reaching loan officers or receiving timely updates on loan statuses. Some customers also reported that their loan processing took longer than expected, which caused delays in closing and, in some cases, additional expenses.

Flagstar Bank currently has a Better Business Bureau (BBB) rating of A+, which indicates great customer service. They also have very few complaints. You can find more Flagstar Bank Mortgage reviews at other review sites as well.

Bottom Line

Flagstar Bank is a competitive lender that will only get bigger as they continue to grow their online presence. So fill out the contact form or call Flagstar’s customer service team to start discussing your real estate and financial goals with a licensed loan officer. No matter where you live in the U.S., you have the opportunity to work with Flagstar.

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