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What New American Funding Offers
New American Funding operates nationwide (except Hawaii and NY) with 163 locations across the nation. Borrowers can check interest rates on its website for 15- and 30-year, fixed-rate conventional loans as well as 30-year, fixed-rate FHA and VA loans. The starting interest rate on 30-year, fixed-rate conventional loan at New American Funding is consistently lower than the national average released by Freddie Mac on a weekly basis.
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For rates on other products, you’ll need to request a quote from the company.
Loan Types
New American Funding offers the following types of mortgages:
- Conventional
- Jumbo
- Construction
- Buydown
- FHA
- FHA streamline refinance
- VA
- VA cash-out refinance
- VA interest rate reduction refinance loan (IRRRL)
- USDA
- Cash-out refinance
- Home equity line of credit (HELOC)
- Reverse mortgage
Along with fixed-rate mortgages, New American Funding also offers 5/1 adjustable-rate mortgages (ARMs) for conventional, jumbo, FHA and VA loans while 7/1 and 10/1 options are only an option for conventional and jumbo loans. The I CAN mortgage offers very flexible repayments terms ranging from eight to 30 years.
Additionally, the company’s Buyer Accepted program can help home buyers to make competitive offers against cash buyers, which is helpful if you are in a hot sellers’ market or want to buy a new home before selling your current one. Through this program, New American Funding purchases the home from the seller, then sells it back to you for the original price along with a convenience fee. Keep in mind that this is available only for conventional or VA loans.
Loan Minimum
New American Funding doesn’t specify online if it has a minimum loan amount. If you’re looking for a small mortgage loan (usually considered to be less than $100,000) to purchase an inexpensive home, you’ll need to check with a loan officer to see if the company can meet your needs.
Loan Maximum
How much you’ll be able to borrow will depend on the type of loan you choose as well as your financial qualifications. With New American Funding, you can borrow up to roughly $1 million with a jumbo loan, depending on where you live. That’s mainly because the conforming loan limit for conventional and FHA loans in most parts of the country is $726,200 in 2023 but goes up to nearly $1.1 million in higher-cost areas like California and New York.
Loan Servicing
Unlike many lenders, New American Funding services the loans it originates. When your loan closes, you’ll receive a welcome letter explaining your payments and how to manage them. The company accepts payments through its website (automatic or one time) or by mail, phone, bank wire or third-party bill-pay service.
Minimum Borrower Requirements
Here are the basic criteria New American Funding requires borrowers to meet:
Minimum Credit Score
The minimum credit score requirements for a few of their loans are:
- 620 for a conventional loan
- 580 for a HELOC (depending on other aspects of your finances)
- 620 for an I CAN mortgage
- 580 for a USDA loan
- 580 for a Cash-Out Refinance
If you have less-than-stellar credit and can’t meet these minimums, you might still be able to qualify for a non-qualified mortgage through another lender. While this can help you get a mortgage with bad credit, you’ll likely end up with a higher interest rate.
Minimum Down Payment
Down payment requirements for a New American Funding home loan are minimal: 0% for USDA and VA loans, and as little as 3% for conventional loans, 3.5% for FHA loans and 5% for I CAN mortgages. Jumbo loans require a down payment of 10%, which has dropped from the 30% that borrowers needed to provide in past years.
Maximum Debt-to-Income (DTI) Ratio
Your DTI ratio is the amount you owe in monthly debt payments compared to your income. The maximum DTI ratio you can have with New American Funding depends on the type of loan you’re applying for as well as other aspects of your finances.
For conventional loans, your DTI ratio should be no higher than 43%. For other kinds of loans, check with the company to see what the DTI requirements are.
What Fees Will You Pay?
New American Funding isn’t transparent online with the fees it charges on its loans and attempts to reach the lender were not returned in time. When it comes to fees like origination fees, rate-lock fees or prepayment penalties, you’ll need to check with the company to see what you can expect to pay in lender fees and closing costs.
How to Apply with New American Funding
New American Funding doesn’t allow borrowers to complete a full application online. Instead, you can call the company or submit a brief screening questionnaire on its website to get in touch with a loan officer.
If you opt to proceed, New American Funding does provide several online options to speed up the process, such as the ability to upload documents and sign forms electronically.
Approval, Underwriting and Closing Timelines
No matter what type of mortgage you apply for, you can usually expect to get a fully underwritten credit preapproval (or rejection) in as little as 24 hours of submitting your request. Unlike some lenders, New American Funding manages its loan processing and underwriting in-house to speed up the process.
The company also guarantees closing most purchase loans in 14 business days. If your loan doesn’t close this quickly, New American Funding will give you a lender credit of $250 to put toward your closing costs (except in delays due to events outside of the company’s control).
What to Do If You Get Turned Down
While New American Funding provides options for borrowers with fair credit, such as USDA and VA loans, it’s possible to have your application denied. If this happens, ask your loan officer what you need to do to qualify. For example, you might have to increase your income, pay down existing debt or improve your credit score to increase your approval odds with New American Funding or another mortgage lender.
You could also consider applying with a co-signer or co-borrower. Keep in mind that this person would share responsibility for the loan, which is a lot to ask—especially if they won’t be living in the home. You can use our mortgage calculator to see how much home you can afford on your own.
Additionally, it’s a good idea to shop around and compare your options from as many mortgage lenders as possible as you might have an easier time qualifying with one compared to another. This can also help you find a good deal. Keep in mind that as long as you submit these multiple applications within a 45-day window, the impact on your credit score will be the same as if you only applied once, according to the Consumer Financial Protection Bureau (CFPB).
What People Are Saying about New American Funding
As of January 9, 2023, New American Funding rating from the Better Business Bureau (BBB) is 3.96 out of 5.00 stars. The BBB has closed 61 complaints in the last 12 months and 162 over the last three years.
The BBB has given New American Funding an A+ rating, but that rating doesn’t take customer reviews into account. Instead, it’s based on how the company responds to complaints, its time in business, size and other factors.
The CFPB’s Consumer Complaint Database shows 194 mortgage complaints for New American Funding from for three years ending January 9, 2023. Most of these were about applying for a mortgage, refinancing a mortgage, having trouble during the payment process or closing on a mortgage. The company provided a timely response to 178 complaints. Note that the CFPB doesn’t verify the accuracy of consumer complaints.
Additionally, while these numbers might seem high, they’re insignificant compared to the number of borrowers who have used New American Funding.
Methodology
We graded New American Funding based on elements that have a meaningful impact on the cost of the mortgage, borrower eligibility requirements, the variety of loan options and loan features that can impact the homebuying process. Our scoring method is based on the following categories:
- Interest rate: 20%
- Down payment requirements: 20%
- Credit score minimum requirements: 20%
- Alternative credit data considered: 10%
- Preapproval time: 10%
- Closing timelines: 10%
- Loan types: 10%
- Lender discounts offered: 5 bonus points
While there are certainly more features that lenders offer, we chose not to include these in our scoring in order to bring forward lenders that have the most competitive rates and are among the most accessible for borrowers of all financial backgrounds.
Our focus on affordability, accessibility, and key features that can impact the homebuying process (like preapproval time and closing timelines) is what we consider reflective of today’s consumer’s top priorities when comparison shopping for mortgage lenders.