Flagstar Mortgage Review 2021 | US News
Flagstar offers banking and loan products to borrowers in all 50 states. Borrowers can obtain mortgage and home equity products including conventional loans, FHA loans, VA loans, ARM loans, USDA loans, and home equity loans and lines of credit.
- Offers a good selection of mortgage and home equity products.
- Has some mortgage loans that don’t require a down payment.
- Can apply for a loan online.
- Most loans require a down payment.
- The home equity line of credit charges an annual fee.
Flagstar offers several different mortgage and home equity products, including some specialized loans. Examples include:
Professional loans: This loan is designed for professionals who have recently finished school or are early in their career and have high earning potential. The loan offers a low down payment with no private mortgage insurance required. What’s more, the lender may exclude some student loan debt when calculating your debt-to-income ratio.
VA interest rate reduction refinance loan (IRRRL): If you currently have a VA loan for your home, this loan allows you to refinance your loan, often with no appraisal and minimal paperwork.
FHA 203(h) loans: If you’re the victim of a presidentially declared natural disaster and your home was damaged to the point of replacement, you could qualify for this loan. No down payment is required, but you will be required to pay mortgage insurance.
- Conventional loans
- FHA loans
- VA loans
- USDA loans
- Jumbo loans
- 5/1, 7/1 and 10/1 ARM loans
- Mortgage refinancing
- Mortgages with no down payment (VA and USDA loans)
- Construction loans
- Home equity loans
- Home equity lines of credit
- FHA 203(k) loans
- State Housing Finance Agency loans
“Most of Flagstar’s (building loan) products are one-time close construction loans,” says Doug Norman, first vice president in builder home lending with Flagstar. “One-time means borrowers don’t have to deal with two separate closings – one for the construction stage and one for the permanent stage.”
Flagstar has a minimum credit score of 620 for its conventional, ARM, USDA and VA loans. Certain VA loans, however, require a higher score.
The down payment and debt-to-income ratio requirements can vary depending on the type of loan you get. The same goes for the minimum and maximum loan amounts.
Like other VA and USDA lenders, Flagstar offers VA and USDA loans with no down payment requirement.
Flagstar mortgage loan fees vary depending on the type of loan you get. The lender’s home equity line of credit charges a $75 annual fee.
Flagstar allows borrowers to lock in their interest rate before and during construction, says Norman. “Clients don’t have to worry about interest rate changes while the home is being built,” he adds.
Is your dream home within reach? U.S. News’ mortgage calculator will show you how much house you can afford.
Flagstar has an A+ rating with the Better Business Bureau, but it isn’t BBB-accredited.
In 2020, the Consumer Financial Protection Bureau received 371 mortgage-related complaints about Flagstar. The most common issues were related to:
- Trouble during the payment process.
- Struggling to pay the mortgage.
- Applying for or refinancing an existing mortgage.
Flagstar provided a timely response to the CFPB for all issues, with 370 closed with an explanation and one with monetary relief.
Borrowers can apply for a mortgage loan online. Home equity loans and lines of credit, however, require a phone call or a visit to a local branch.
- People who want more loan options.
- People who want a VA or USDA loan with no down payment.
- People who need financing for building a new home.