New American Funding: 2023 Home Equity Review
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At a glance
NMLS: 6606
Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.
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Loan amount
Up to $400,000
Min. credit score required
620
Repayment terms
Up to 20 years
Funds available in
New American Funding features
Here's a breakdown of some of the benefits and drawbacks of New American Funding home equity loans.
PROS
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With a New American Funding HELOC, you can borrow up to 85 percent of your combined loan-to-value (CLTV) ratio, up to $400,000.
You’ll get a fixed rate on your initial draw. (For subsequent draws, however, that rate moves higher or lower based on prevailing market rates.)
CONS
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New American Funding requires HELOC borrowers to withdraw all of their equity funds at closing.
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The lender doesn’t work with HELOC borrowers in some states, including New York and Texas.
New American Funding overview
New American Funding is a mortgage lender headquartered in Orange County, California. It has been offering home loans for two decades, over time spearheading initiatives to support underserved communities, particularly Black, Latinx and veteran homebuyers. In addition to purchase loans and refinances, the lender offers home equity lines of credit (HELOCs) to homeowners in most states.
New American Funding snapshot
| Home equity loan types | Home equity line of credit (HELOC) |
| Loan amounts | Up to $400,000 |
| Credit score minimum | 620 |
| Repayment terms | Up to 20 years |
| Average time to approval | As few as five minutes; funding in as few as five days |
How Bankrate rates New American Funding
| Bankrate Score | 4.2 |
| Affordability | 3.6/5 |
| Availability | 4.1/5 |
| Borrower experience | 4.8/5 |
Methodology
To create our Bankrate Scores, we evaluated lenders based on availability, affordability and customer experience. Availability was assessed based on the minimum loan amount required, time to approval, days to close, minimum draw requirements, minimum credit score requirements and loan types offered. Affordability was assessed based on minimum APR, discounts and promotions offered and associated fees. Customer experience was assessed based on online application and account availability, customer support, auto payment availability and mobile app availability and ratings.
Benefits
- With a New American Funding HELOC, you can borrow up to 85 percent of your combined loan-to-value (CLTV) ratio, up to $400,000.
- You’ll get a fixed rate on your initial draw. (For subsequent draws, however, that rate moves higher or lower based on prevailing market rates.)
Drawbacks
- New American Funding requires HELOC borrowers to withdraw all of their equity funds at closing.
- The lender doesn’t work with HELOC borrowers in some states, including New York and Texas.
Type of fees charged
New American Funding charges a 4.99 percent origination fee on HELOCs, along with an appraisal fee as well as recording fees, depending on your location.
Home equity loan products offered
New American Funding offers HELOCs to borrowers in the majority of states (excluding Delaware, Hawaii, Kentucky, Maryland, New York, South Carolina, Texas and West Virginia). Depending on your home’s value and level of equity, you could take out up to $400,000 with this lender’s line of credit. However, unlike some other HELOC lenders, you’re required to draw all of these funds initially; you can then draw more as you repay. Your repayment period could last up to 20 years after the draw period.
With a New American Funding HELOC, you’ll get a fixed interest rate on the initial draw. If you borrow more during the draw period, you’ll pay whatever the prevailing market rate is at the time, which might be higher than the initial rate. The most competitive HELOC rates go to well-qualified borrowers who set up auto-pay.
You can only get a HELOC through New American Funding on your primary residence.
How to qualify for a HELOC with New American Funding
To qualify for a HELOC with New American Funding, you’ll need a credit score of at least 620 and at least 15 percent to 20 percent equity in your home. Like many types of home loans, the debt-to-income (DTI) ratio caps out at 43 percent. You’ll also need to have sufficient income and meet other eligibility criteria, such as having homeowners insurance.
How to get started
You can apply for a New American Funding HELOC on the lender’s dedicated HELOC website. The lender allows you to link your accounts in the online application, which can help speed up the process. New American Funding is also available by phone at 888-964-7404, Monday through Saturday, 9 a.m. to 8 p.m. ET.
New American Funding - CPC customer ratings and reviews
NMLS: 6606
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