Better Mortgage Review 2023

How Bankrate scored Better Mortgage

Better sets itself apart with a fast underwriting process and a comprehensive array of mortgage products, including conventional, government-insured (FHA and VA), and refinance loans. However, while it’s speedy, customer service can be a weak spot (as often with online lenders) and its loan offerings are limited.

• Affordability: As of this review, Better’s mortgage rates were lower than Bankrate’s averages, and the lender doesn’t charge any fees.
• Availability: You can compare loan options from Better no matter where you live, as the lender operates nationwide. It only offers conventional, FHA and VA loans, however.
• Borrower experience: J.D. Power rated this lender below average for customer satisfaction in its 2022 mortgage origination study. A bright spot, however: You can easily contact Better any time with questions.

• Methodology

  Bankrate's expert editorial team collects lender information through a variety of methods. We contact lenders directly, and we also turn to regulatory filings and to assessments by third parties. Our research takes into account three main factors – affordability, availability and borrower experience.

  Bankrate's reporters and editors have decades of experience covering the mortgage industry. They're skilled at gathering information through interviews and by scouring regulatory filings. Bankrate evaluates more than 85 lenders for factors relating to affordability, availability and customer experience, assigning each a Bankrate Score out of five stars. Here's how we assess each of the categories:

  • Affordability. Loan cost is a deciding factor for many borrowers. We look at two metrics: 1) a lender's lowest advertised annual percentage rate (APR) based on Bankrate's sample scenario, which assumes a 740 or higher credit score and a 20 percent down payment, among other factors and 2) established-customer discounts or incentive pricing, when applicable.
  • Availability. Another factor is how quickly your loan application will be approved, and how many loan programs the lender offers. So we evaluate approval and closing timelines and diversity of loan products.
  • Customer experience. Finally, we delve into what it's like to deal with the lender as a consumer. We look at the lender's application process and availability of customer service support. We also consider the results of J.D. Power's 2022 Mortgage Origination Satisfaction Survey.

  Bankrate's editorial team confirms the accuracy of data at the time of publication. Our team is dedicated to maintaining the timeliness of information – the mortgage industry is changing constantly, so we regularly revisit these reviews to update them.

  Bankrate's methodology page spells out our rating process in greater detail.

Affordability: 5/5

Loan cost is a deciding factor for many borrowers. The affordability nature of loans differ from lender to lender, so comparing costs is key. Notably, Better doesn’t charge any origination, application or processing or underwriting fee — a big boost to its affordability quotient. As to terms, Better displays mortgage rates on its website and updates them several times a day. To use the rate tool to obtain a personalized quote, however, you’ll be prompted to sign up for emails from the lender that contain mortgage news and promotions.

Availability: 5/5

Availability factors can make the overall mortgage-application process smoother or more challenging. Better works with borrowers all across the U.S., offering conventional, FHA and VA loans as well as some creative financing options like bridge loans. If you’re looking for a USDA loan or home equity options, you’ll need to go to another lender, though.

Borrower experience: 4.7/5

Customer experience factors can help you know what to expect when you work with a specific lender. As of this review, Better has a B rating from the Better Business Bureau and a 4.2 out of five stars from Trustpilot, indicating “Excellent” reviews. The lender ranked below industry average, however, in J.D. Power’s 2022 mortgage origination survey for customer satisfaction.

How to apply for a mortgage with Better Mortgage

As a Better customer, you’ll complete a fully digital application process. To get started, you should have a credit score of at least 620, Better’s minimum for purchase loans and rate-and-term and cash-out refinance loans. Be prepared to provide detailed documentation of your financial life.

1. Run the numbers. Make sure that your credit score, debt-to-income ratio, and savings are in good shape. A strong credit score can help you to secure a competitive interest rate, saving you thousands over the life of your loan.
2. Gather documents. You’ll need to provide 2 years of personal and business tax returns, W2s or 1099 and bank statements, as well as proof of any alimony or child support payments. As a Better customer, you can link your bank accounts and upload your documents digitally.
3. Get your verified preapproval letter. Once Better processes your documents and performs a credit check, you’ll receive a digital, underwriter-reviewed letter if you’re preapproved – maybe in as little as three minutes. Better’s underwriters will do most of the work needed to verify your financial details by the time your home offer is accepted and you’re ready to apply for a mortgage. You may be able to close your loan as soon as within 14 days of locking your rate.
4. Lock your rate. You’ll need to pay a $550 appraisal fee once you have the purchase contract for your new home and are ready to lock your rate. If applicable, you’ll also need to pay a $325 HOA fee.
5. Submit your documents. You’ll need to upload your financial documents and provide a home insurance quote. Better will already have most of the information they need if you got a Verified Pre-Approval Letter first.

Refinancing with Better Mortgage

Better offers both cash-out and rate-and-term refinance loans. If you’re looking for quick money, you might consider Better’s cash-out refinance loans, which offer preapprovals in as little as three minutes. The lender’s average closing time is 32 days, 10 days faster than the industry average, thanks to a streamlined online process.

Better allows you to roll your closing costs into your new loan when you refinance if you want to save on costs upfront. You’ll need a credit score of at least 620 to qualify for a conventional loan refinance, and you’ll need a credit score of at least 700 to qualify for a jumbo loan refinance.