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Insider’s Featured Mortgage Lenders
Pennymac: Overall Lender Rating
Pennymac Mortgage
Types of Loans Offered
Conforming, FHA, VA, USDA (streamline only), jumbo, high balance, flex terms, manufactured, home equity loan
- Wide range of mortgage offerings
- Instant rate quote tool makes it easy to get customized rates
- Flexible term lengths
- Doesn’t accept alternative credit data
- Requires a minimum score of 620 for its FHA mortgages
Product Details
- Available in all 50 states
- Charges a $1,100 origination fee
- Minimum credit score and down payment displayed is for conforming mortgages. Only first-time homebuyers are eligible to put down 3%; others must put down at least 5%
Pennymac: Pros and Cons
Pennymac Mortgage Interest Rates and Fees
Pennymac makes it convenient to compare mortgage rates. If you click on “Rates” at the top left of the Pennymac website, you can view today’s sample rates or use the instant quote tool to get rates customized to your situation. These customized rates are based on the price and location of the property you’re purchasing, the size of your down payment, and your credit score.
Pennymac charges a $1,100 origination fee on its conforming and FHA mortgages. However, if you’re purchasing a home rather than refinancing, or if you’re getting an FHA streamline refinance, it may waive this fee for you.
Pennymac’s VA mortgages come with an origination fee equal to 0.95% of the loan amount. If you’re using a VA mortgage to purchase a home, it will reduce this fee by $1,100.
In 2021, the average borrower getting a conventional mortgage from this lender paid $3,209 in origination charges, according to Home Mortgage Disclosure Act data. This is around average compared to other lenders.
Compare Pennymac to Other Mortgage Lenders
Pennymac vs. Rocket Mortgage
To get personalized rates from Rocket Mortgage, you’ll need to start an application. Pennymac, on the other hand, lets you easily explore rates without having to apply or create an account first.
Rocket Mortgage ranked No. 2 in J.D. Power’s 2023 Primary Mortgage Origination Satisfaction Study, while Pennymac ranked below average. If customer service is important to you, Rocket Mortgage might be a better choice. Rocket is also one of our best mortgage lenders.
Pennymac vs. LoanDepot
LoanDepot doesn’t list any rates online, making it difficult to compare this lender to others if you aren’t ready to apply for preapproval. By contrast, Pennymac’s rate quote tool makes it easy to get an idea of what your rate might look like.
If you’re a first-time homebuyer, you may also be able to put down less with Pennymac than with LoanDepot, which requires a down payment of at least 5%. Pennymac lets first-time homebuyers put down as little as 3%.
How Pennymac Works
Pennymac is an online lender that originates mortgages in all 50 US states. It offers conforming, FHA, VA, USDA streamline refinances, jumbo, and home equity loans.
It also offers a variety of refinancing options on its loans, including rate-and-term refinancing, cash-out refinancing, and streamline refinancing on its FHA and VA loans. Additionally, it has flexible term options, which is a particularly good perk if you’re refinancing, since you can pick the exact term length that works for you.
Pennymac has mortgages for primary residences, second homes, and investment properties, as well as manufactured homes. You can get a high-balance loan with this lender, which is a mortgage that exceeds the nationwide conforming loan limit but isn’t considered a jumbo loan because it meets the county loan limit in a high-cost area.
If you’re a first-time homebuyer, you may be able to put just 3% down on a conforming mortgage with Pennymac. Other borrowers will need to put down at least 5%.
If you plan on getting an FHA mortgage, you’ll need a credit score of at least 620 to qualify with this lender. This is higher than what many other lenders require on their FHA mortgages — typically, the minimum credit score is 580.
Pennymac doesn’t consider alternative credit data (such as proof of rent or utility payments) on any of its mortgages. If you want to apply with this lender, you’ll need a decent credit score.
If you’re refinancing with Pennymac, you’ll pay an origination fee of $1,100. If you’re getting a VA mortgage refinance, the origination fee is equal to 0.95% of the loan amount. The origination fee is waived on conforming and FHA purchase mortgages and FHA streamline refinances, and is reduced by $1,100 on VA purchase mortgages.
If you want to apply for a mortgage, you can do so online. You can also get started over the phone Monday through Friday from 6 a.m. to 7 p.m. PT, and Saturday from 6 a.m. to 5 p.m. PT.
Is Pennymac Trustworthy?
Pennymac has an A+ rating from the Better Business Bureau. BBB ratings are based on a company’s response to customer complaints, honesty in advertising, and transparency about its business practices.
In J.D. Power’s 2023 customer satisfaction study, Pennymac ranked below the industry average. However, the lender has a 4.37 out of 5-star rating on its Zillow profile, based on over 300 online customer reviews.
Pennymac FAQ
We didn’t rate Pennymac as high as some of our favorite mortgage lenders, but it’s still an overall solid option, particularly if you’re getting an FHA or VA loan. We like that Pennymac lets you get a rate quote without having to provide contact information, but if you have a lower credit score, it might not be a great choice for you.
Yes, Pennymac currently offers home equity loans.
To qualify with Pennymac, you’ll typically need at least a 620 credit score, but this may vary depending on the type of mortgage you’re getting and the details of your loan.
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