Penfed Mortgage Program Review: Pros, Cons, What to Expect

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PenFed Mortgage

PenFed Mortgage is a very popular mortgage provider that works with customers from all walks of life. With offices conveniently located in multiple locations across the United States, many consumers turn to them for their home buying needs. Our article is going to serve as an in-depth review of PenFed Mortgage that will focus on several important factors like the types of loans that they offer and more.

PenFed Mortgage – Details and Overview

PenFed Mortgage, otherwise known as PenFed Credit Union, was originally established in 1935. With over $24 billion in total assets, they regularly work with clients all across the United States. They currently service people in virtually every state.

The bank is federally insured by NCUA and continues to grow its business with each passing year. Maintaining an A+ rating with the Better Business Bureau, it has established itself as a name that new and existing members can trust.

PenFed Mortgage Loan Process Explained

Understanding The Basics of Membership

The first and most important part to understand about the PenFed Mortgage loan process is that all potential applicants must qualify for membership with the bank. The reason for this is that PenFed is a credit union and has a list of potential options that can help get you a membership with them.

To view a breakdown of the ways to become a member, consider checking out their membership page. The most common way to be an approved member is to be a member of the armed forces.

Other organizations that offer support for troops and their families can also pave the way to membership at PenFed. Common examples include being a member of the National Military Family Association or Voices For America’s Troops. Once you are sure that you qualify for membership at PenFed mortgage, you’re ready to proceed to the next step.

Examining the Available Loan Types

One of the areas where PenFed really shines is in the various loan offerings that they currently offer. Some of the most popular loan programs that clients regularly take advantage of include traditional mortgages and jumbo mortgages. Both of these loan types are available as either fixed or ARMs.

With a standard 30-year fixed mortgage, you can expect to pay as little as 4.625 percent. That rate goes down even further when you opt for a 15-year loan instead with a standard rate of only 4 percent.

For jumbo loans, they are designed for purchases that exceed $453,100. A fixed 30-year loan for this type of mortgage will typically come with an interest rate of only 4.625 percent. Being geared towards military families, PenFed Mortgage also offers VA loans.
VA loans have the added benefit of not requiring a down payment and typically have much more flexible credit terms. A 30-year fixed VA mortgage has an interest rate of only 4.5 percent. The most important thing to keep in mind about this loan type is that only certain military members can qualify for it. In addition, some additional defense agency employees may be eligible as well.

To get a full listing of all the current PenFed Mortgage rates, simply check out their rate comparison page. It is updated regularly with the mortgage rate information for their most popular financial mortgage types.

The one downside we discovered is that PenFed does not offer FHA loans. These loans are traditionally designed for first-time homebuyers and are designed to reduce the down payment requirement. However, their rates are still very competitive and are easy to locate on their website.

Moving Onto the Prequalification

At this point in the game, you should now have a basic understanding of what types of mortgages that PenFed offers. You’re now ready to begin the prequalification stage. There are two different methods to do this.

The first method is to reach out via telephone by calling an agent at 1-800-970-7766. This method will slightly increase the processing time since you will have to sign disclosures and other documents via traditional mail.

The other option is much faster and can be completed online by accessing their prequalification page. You will sign your disclosures online and will be asked to provide various documents for your loan officer to review.

Some common document examples include two years of tax returns, multiple paycheck stubs, as well as checking and savings account bank statements. Using this information, your loan officer will determine approximately how much home you can afford. If your credit score meets the initial requirements for your given loan program, you will be given a prequalification letter to take to your real estate agent while you look for a potential new home.

Making Your First Offer

If you’re progressing to this stage, things are going smoothly. You should be ready to make an official offer with a seller on the home of your choice. If the seller accepts your tentative offer, a contract will be drawn up and your mortgage will move into the underwriting stage.

During the underwriting stage, PenFed will ask you for a variety of different information again. They will frequently request updated paycheck stubs as well as bank statements from you. In addition, they will likely ask you to start getting quotes on home insurance for the prospective property as well. This will be used to create your escrow estimate.

In addition, you will also need to get an appraisal done and possibly a home inspection as well. Once all this information is received, your PenFed mortgage officer will crunch the numbers again to make sure that everything meets the requirements for your given mortgage type. If all goes well, you will progress to the closing stage.

Closing and Your First Payments

You’re at the final stage in the game and are ready to close on your house. The closing date typically occurs anywhere from one to two weeks after the initial offer was accepted. During the closing, you will review important financial disclosures and sign your official loan paperwork.

Be sure to pay careful attention to important details like your loan term and the interest rate. Once all your documents are signed, you will receive the keys to your new home and your payment remittance slip. The payment slip will have your account information on it that can be used to sign up for online account access. Online account management allows you to quickly and easily schedule online payments and print out important tax information each year.

PROs and CONs of PenFed Mortgage

Pros

  • Offers very competitive rates.
  • Information is prominently displayed on their website.
  • Can apply via online or telephone.
  • Jumbo mortgages available for larger property purchases.

Cons

  • Requires membership qualification with the credit union.
  • Does not currently offer FHA loan types.

PenFed Mortgage Customer Service Review

Overall, most customers seem to be very satisfied with the level of service that they receive from PenFed Mortgage. It helps that their customer service representatives can be reached via telephone, email, as well as traditional mail.

Contact Information

  • Official Website: Penfed.org.
  • Mortgage Customer Service Telephone Number: 1-800-970-7766.
  • Mortgage Customer Service Email: MyHomeDocs@PenFed.org.
  • Facebook: PenFed.
  • Twitter: PenFed.

Summing Up

Overall, PenFed Mortgage is an excellent choice for many consumers. They offer competitive rates and have a wide range of free educational resources to take advantage of. With both an online and telephone application process to choose from, users should have no problem getting the help they need during their home buying experience. So, if you have had the chance to try PenFed Mortgage yourself, feel free to tell us a bit about your experience.

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