Is Better Mortgage really better?
May 19, 2021 11:45 AM Subscribe
We're thinking about refinancing our home, in order to lock in a lower interest rate. The best rates I've found are with Better Mortgage, of which I'd never heard until yesterday. Is this a reputable company? I've been reading mostly great reviews of this company, but is this apparent goodness on the level?
They seem to sell the mortgage to somebody else and don't hold it themselves. Is this good/okay/bad? Our current mortgage is with Chase, and their refi rates are nowhere as good as Better. If Better isn't good, is there a company that's better?
Yeah, I don't know about this company in particular, but that's a pretty standard industry practice. I'll leave the value judgments to someone else, but pretty much every bank will sell your mortgage to someone else, and big ones like Chase might sell it, buy it back, and sell it again over the life of the mortgage.
posted by kevinbelt at 11:59 AM on May 19, 2021
posted by kevinbelt at 11:59 AM on May 19, 2021
Your question is more or less the same as others that I've answered, so I will just refer to my answers.
What does it mean to be "reputable" for a refinance?
Is better.com a competitive lender?
posted by saeculorum at 12:08 PM on May 19, 2021 [1 favorite]
What does it mean to be "reputable" for a refinance?
Is better.com a competitive lender?
posted by saeculorum at 12:08 PM on May 19, 2021 [1 favorite]
I've gotten three mortgages (initial mortgage and two refinances) with mortgage originators/banks I'd never heard of before I started the application process and I've been totally happy about it! Two of them sold the mortgage on to other banks and one has held on to it. I found these companies through Own Up, which is available in many but not all US states (I recommend them highly if you're in one of their service areas). I'm not going to name the mortgage companies specifically because they are SO random you could probably steal my identity based on those three pieces of information plus my username.
If you're refinancing and it's not, like, an urgent matter, pretty much the worst case scenario is something goes wrong and you can't close and you're stuck with your current mortgage, which really isn't the end of the world (barring some case of really egregious fraud, but that's pretty rare nowadays).
So, not a vote in favor of Better Mortgage, but definitely a vote in favor of random mortgage originators you never heard of. And most mortgage originators do sell your mortgage to other banks. Even if they say they won't sell your mortgage (which may or may not be binding), there's nothing to stop the bank merging with another bank or getting bought. I find one bank's automated withdrawal from my checking account to be much like another's so it's a big "whatever" for me.
posted by mskyle at 12:09 PM on May 19, 2021
If you're refinancing and it's not, like, an urgent matter, pretty much the worst case scenario is something goes wrong and you can't close and you're stuck with your current mortgage, which really isn't the end of the world (barring some case of really egregious fraud, but that's pretty rare nowadays).
So, not a vote in favor of Better Mortgage, but definitely a vote in favor of random mortgage originators you never heard of. And most mortgage originators do sell your mortgage to other banks. Even if they say they won't sell your mortgage (which may or may not be binding), there's nothing to stop the bank merging with another bank or getting bought. I find one bank's automated withdrawal from my checking account to be much like another's so it's a big "whatever" for me.
posted by mskyle at 12:09 PM on May 19, 2021
Look in the fine print at the annual percentage rate (APR), which will normally be different than the interest rate in the large print. How big of a difference is there in that number? If it's larger than 0.05-0.10%, that's where companies like Better make a large profit in "fees" before selling the mortgage to Fannie/Freddie like everyone else.
It looks like no cost to you now, but you'll be paying for it every month for the next 15 or 30 years.
posted by JoeZydeco at 12:11 PM on May 19, 2021
It looks like no cost to you now, but you'll be paying for it every month for the next 15 or 30 years.
posted by JoeZydeco at 12:11 PM on May 19, 2021
I did my last refi through Better and will likely use them for an upcoming purchase. Well, technically I went with Ally because they give a discount to customers, but Better operates their program behind the scenes. They're a good originator. Very tech driven so you rarely if ever need to speak with anyone.
They will definitely turn loan servicing over to someone else. I've been transferred twice, no problem either time. I don't know if anyone really loves their loan servicer but i haven't had any complaints.
posted by tinymojo at 12:32 PM on May 19, 2021 [1 favorite]
They will definitely turn loan servicing over to someone else. I've been transferred twice, no problem either time. I don't know if anyone really loves their loan servicer but i haven't had any complaints.
posted by tinymojo at 12:32 PM on May 19, 2021 [1 favorite]
We just finished a refi with Better. It was a...mixed...experience.
The positives are that the rates were as advertised, no surprises at the end. The other positive is that everything is done online, the closing was done by a mobile notary who came to the house.
The negatives are that they were incredibly slow, lacking in initiative and terrible communicators. It is clear they hire people who have no idea what they are doing, and they just try and rely on the system's automation. They kept having to extend the rate lock (which they did), and one of the sticking points was that they couldn't seem to get it together to get documentation from my work about my income, and when I would send them the information of how to get it, they would say they were on it, and then another week would pass, and then another. I finally ended up having to do it for it them.
There is a reason for mortgage brokers, is all I am saying.
posted by nanook at 12:35 PM on May 19, 2021 [2 favorites]
The positives are that the rates were as advertised, no surprises at the end. The other positive is that everything is done online, the closing was done by a mobile notary who came to the house.
The negatives are that they were incredibly slow, lacking in initiative and terrible communicators. It is clear they hire people who have no idea what they are doing, and they just try and rely on the system's automation. They kept having to extend the rate lock (which they did), and one of the sticking points was that they couldn't seem to get it together to get documentation from my work about my income, and when I would send them the information of how to get it, they would say they were on it, and then another week would pass, and then another. I finally ended up having to do it for it them.
There is a reason for mortgage brokers, is all I am saying.
posted by nanook at 12:35 PM on May 19, 2021 [2 favorites]
Unfortunately, OwnUp says they are not licensed in NY, and therefore will not give a New Yorker any information.
posted by DMelanogaster at 12:47 PM on May 19, 2021
posted by DMelanogaster at 12:47 PM on May 19, 2021
Fwiw, I am buying a house right now, and the most competitive interest rate was offered by my local credit union. I'm really glad I went with them - the customer service has been above and beyond.
posted by toastedcheese at 1:50 PM on May 19, 2021 [1 favorite]
posted by toastedcheese at 1:50 PM on May 19, 2021 [1 favorite]
We used better for a refinance and it was fine! Mortgage has been resold twice.
posted by WedgedPiano at 6:27 PM on May 19, 2021
posted by WedgedPiano at 6:27 PM on May 19, 2021
I would happily use Better for another refi, where speed is not of the essence. Their rates are good, and they disclose all the fees clearly. The downside is, as others have noted, that they don’t move quickly.
There’s not one person ensuring your mortgage makes it through, instead there are some handoffs, and speed and diligence varied widely between steps.
posted by whisk(e)y neat at 11:35 PM on May 19, 2021
There’s not one person ensuring your mortgage makes it through, instead there are some handoffs, and speed and diligence varied widely between steps.
posted by whisk(e)y neat at 11:35 PM on May 19, 2021
I did my original mortgage with a small local mortgage broker and a refi with Better mortgage. I'm glad I used a local broker the first time around; I needed the handholding at that point because I really needed everything to work out, and my then-situation of self-employed and separated-but-not-divorced, and having a sticky tax situation made their proactiveness and commitment to getting me my loan a real asset. My experience with Better was similar to nanook's--kind of slow, bad communication, they kept asking me for things that didn't really make sense in my situation and was very cookie cutter. But because it was a refi, I wasn't under any huge pressure to make it happen according to a specific timeline. I also wound up with a really shitty appraiser/appraisal but I don't know if that's their fault.
As everyone else has said, mortgage originators pretty much always resell their loans. My current refi loan got transferred twice before my first payment was due.
posted by drlith at 7:55 PM on May 20, 2021 [1 favorite]
As everyone else has said, mortgage originators pretty much always resell their loans. My current refi loan got transferred twice before my first payment was due.
posted by drlith at 7:55 PM on May 20, 2021 [1 favorite]
« Older Can my family live off low cook/no cook meals 3/4... | Help me not miss another morning meeting! Newer »
This thread is closed to new comments.
posted by The_Vegetables at 11:51 AM on May 19, 2021