There are lots of different ways to get a mortgage these days – you can walk into a physical bank branch, call a mortgage broker, or even start a loan application on your smartphone.
While the mortgage broker model isn’t new by any means, a company called “Credible” is shaking things up on that front, promising real-time mortgage rates from multiple mortgage lenders without the “annoying calls or emails.”
They also let you compare rates and close your loan all in one place. Let’s learn why this company is different and if they make sense for your mortgage needs.
Credible Launched Back in 2012
- Company founded by former investment banker in 2012
- Initially focused on student loan refinancing
- Has since delved into personal loans, credit cards, and mortgages
- Lets you compare personalized loan offers from multiple lender partners
- Acquired by Fox Corp. in late 2019
The company is relatively new, having been founded less than a decade ago in San Francisco.
But that didn’t stop it from being acquired by none other than Fox Corp., better known for TV shows like The Simpsons rather than finances.
Originally a student loan marketplace, the company has since expanded to personal loans, mortgages, and credit cards.
Our focus will be the mortgage piece of the pie, this being a mortgage blog and all.
In late 2018, Credible announced a “first-of-its-kind mortgage marketplace” that offers actual rates to consumers in just two or three minutes, all without affecting the applicant’s credit score.
But that’s not all – you also get a streamlined origination platform that allows you to complete much of the loan process without leaving Credible’s website, similar to Rocket Mortgage.
Their digital process utilizes “smart logic” to cut down on the number of questions asked to borrowers, as well as documentation requests, by making sure they are pertinent to your unique situation.
Additionally, the Credible platform automates the collection of things like pay stubs, bank statements, and tax documents, making the application process both faster and easier to complete.
Many of these items can be gathered electronically by simply granting access to your financial institution, without having to exit the Credible website.
However, they also have licensed loan officers available to those who would like additional support along the way. And they don’t work on commission, so they should have your best interests in mind.
How Credible Works to Get a Mortgage
First, you tell them a little about yourself and your property, just like most other mortgage companies.
This includes your property address, whether it’s a primary, second, or investment home, property type, estimated value, and mortgage balance.
Next, they ask if you have a second mortgage or if you’re looking to take cash out in addition to refinancing your existing loan balance.
One neat feature is they provide estimates of your property taxes and homeowners insurance for you, but you can adjust those numbers if needed.
They then ask for a source of income and average annual income, along with how much you have in assets.
If it’s a home purchase loan, they’ll ask you how far along you are in the process (just looking or found a home, etc.), and what your down payment will be.
You can generate a pre-approval letter instantly and see how much you can afford based on your inputs.
Lastly, you enter your name, date of birth, and phone number, agree to their terms and conditions, and get your loan options.
They note that they take privacy seriously, and that they’ll NEVER sell your information to external companies, nor will you receive phone calls from lenders.
Once you click “See My Rates,” a soft credit check (doesn’t affect your credit score) is conducted to look up your credit history and credit scores to ensure your pre-qualified rates are accurate.
If any of their partner lenders have home loan options that fit your profile, you’ll see a notification on your Credible Dashboard within minutes.
Credible will also reach out via email, phone, or text, but only once they have received responses from all potential lenders.
Note that these are just pre-qualified rates, and you’ll still need to qualify, like you would any other mortgage.
Once you select a loan option, you will be asked to provide additional information, and a hard credit pull will take place (these do affect your credit).
If your credit and application pass muster, the mortgage lender partner will provide you with an offer that you can review.
Then you’ll begin the loan process by signing disclosures, providing financial and personal documentation, and so on.
What Types of Home Loans Does Credible Mortgage Offer?
- They offer home purchase and refinance loans
- Including conventional conforming and jumbo loan amounts
- FHA, VA, and USDA loans don’t seem to be available at the moment
Credible has two main mortgage options available – Home Loans, which is designated for purchase transactions, and Mortgage Refinancing, which as the name implies is for refinancing an existing home loan.
This means both prospective home buyers and current homeowners can take out a mortgage using Credible.
In terms of loan types available, I’ve been told that they only offer conventional loans, aka non-government. That means no FHA, VA, or USDA. It’s unclear if that will change soon, but I assume it will.
They also offer jumbo loans, those that exceed the conforming loan limit.
So if your loan scenario fits those criteria, there’s a good chance their lender partners will provide you with pre-qualified rates.
Which Mortgage Lenders Does Credible Work With? And How Do They Get Paid?
- The first two lenders to join Credible were Quicken Loans and UWM
- There are now several others including loanDepot and Stearns
- Credible acts as a mortgage broker and only gets paid if the loan funds
- They receive a percentage of the loan amount from the lender who closes your loan
While they don’t list all the mortgage lenders they work with, they do displays the logos of Caliber Home Loans, JMAC Lending, loanDepot, Quicken Loans, Stearns Lending, and UWM.
Originally, they started with just Quicken Loans and UWM, so it’s possible there are even more lender partners today.
As noted, you don’t need to work with those companies directly, or talk to anyone at those companies.
Instead, you can continue to complete your loan application on the Credible website, or ask for assistance from a Credible loan officer.
This is similar to how a mortgage broker works – they handle everything and you never actually deal with the wholesale lender providing the financing.
In terms of how Credible gets paid, it’s also like how a mortgage broker gets paid. If and only if the loan funds, they receive compensation from the corresponding lender.
That means they don’t charge you any fees directly, but rather take a cut, which is a flat percentage of your loan amount, such as say 1% or 2%.
For example, on a $500,000 loan they might make $5,000 to $10,000, depending on the terms they have with their lender partner.
Where Is Credible for Mortgages Available?
It’s important to note that Credible isn’t available to mortgage borrowers nationwide. Part of the reason being their recent launch in late 2018.
While they are expected to reach most if not all states eventually, here’s where they are available now:
Alabama Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Idaho Illinois Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Montana Nebraska New Hampshire New Jersey New Mexico North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Vermont Virginia Wisconsin Wyoming Washington D.C.
Those states alone account for the lion’s share of all loan origination volume in the United States, per Credible.
States that are missing include Alaska, Hawaii, Indiana, Missouri, Nevada, New York, Utah, Washington, and West Virginia.
Again, that could change soon as they get more licenses under their belt, so be sure to check their site for updates.
Should I Use Credible to Find a Mortgage?
- If you like the idea of a mortgage broker in terms of shopping around
- But don’t actually want to deal with a human being
- Credible could be a good option for your home loan needs
- Just note that they may not offer all loan types at this time
- However they do come highly rated by both Trustpilot and the BBB
If you live in one of the states where Credible offers mortgages, you might be wondering if they’re a good choice.
They refer to themselves as “Your trusted online mortgage broker,” which highlights the fact that they aren’t a direct-to-consumer lender. Nor are they a mortgage lender at all.
Rather, they connect you to trusted lender partners and earn a commission if your home loan funds.
As noted, they don’t charge any fees directly, nor do they hit your credit report with a hard inquiry. Despite this, you get to compare real, pre-qualified rates from a variety of lenders in minutes.
So if you aren’t the type to shop around, but still want the benefit of shopping around, you could give them a whirl.
And you can take advantage of their digital platform, which should make the loan process easier, smoother, and quicker.
However, you’re still at the mercy of one of the lenders they match you up with, so customer experiences will certainly vary based on your unique loan scenario and the lender you’re paired with.
Another potential negative is they don’t seem to offer all types of mortgages – those looking for an FHA, VA, or USDA loan may want to search elsewhere until they add those loans to their stable of offerings.
In terms of customer satisfaction, they have an excellent rating on Trustpilot and an A+ rating with the Better Business Bureau.
They could be a good alternative to LendingTree, which provides a similar shopping experience without the ability to complete the loan process on their own website.
