Lower Mortgage Review 2023

How Bankrate scored Lower

To determine Lower’s Bankrate Score, Bankrate’s editorial team rated it and other lenders on a scale of one to five stars based on a variety of factors relating to the lender’s products and services. (Bankrate’s partners compensate us, but our opinions are our own, and partner relationships do not influence our reviews.) We derived its overall score by considering three basic factors:

• Affordability: Lower’s rates are typically slightly higher than Bankrate’s averages, but its fees are consistent regardless of loan amount.
• Availability: Lower is available to borrowers in the majority of states (one notable exception being New York), and it offers a range of purchase, refinance and home equity options.
• Borrower experience: Lower has very high marks from the Better Business Bureau and customers on Bankrate. Another standout: Its down payment savings app.

• 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.

  Our editorial team confirms the accuracy of data at the time of publication and is dedicated to maintaining the timeliness of information.

Affordability: 4/5

Affordability differs from lender to lender, so comparing costs is key. Lower’s rates aren’t as low as Bankrate’s averages, but the lender’s flat-fee structure could mean you save money even if you need a jumbo loan. For purchases, Lower charges a flat $995 fee, and for refinances, a flat $1,695 fee. One big perk: That refi fee is waived if you’re an existing borrower. The lender displays current rates on its website so you can easily make comparisons. Lower also aims to help you save with its app, which features the option to put money (“HomeCash”) aside for your down payment in an FDIC-insured, interest-bearing account. You’ll be able to earn an additional $1 for every $1 you deposit, up to $500. You can only apply these funds to a home purchase mortgage through Lower, however, and you can’t put them toward the purchase until they’ve seasoned for one year (after your first deposit).

Availability: 4.3/5

This factor can make the overall mortgage application process smoother or more challenging. Lower’s mortgage options include conventional and government-insured loans (FHA, VA and USDA), along with home equity products and refinancing. If you need a bigger loan for a pricier home, the lender also offers jumbo mortgages and investment property loans. Note, though: Lower isn’t licensed to lend in every state. Be sure to check availability before requesting a preapproval from this lender.

Borrower experience: 4.6/5

Know what to expect when you work with a specific lender. Lower boasts $23 billion in loan volume and has an A+ grade from the Better Business Bureau, although it isn’t accredited by the organization. Thousands of borrowers have had positive experiences with this lender, according to Bankrate, BBB and Trustpilot testimonials. If you’re interested in a mortgage through Lower, you can apply for a loan via its website, and often e-sign documents for added convenience. Its website has various educational and planning tools, as well.

How to apply for a mortgage with Lower

You can apply for a purchase loan or a refinance on Lower’s website or by calling 888-509-8301. The lender offers customer support by email and phone, with business hours from Monday to Friday, 8:30 a.m. to 6 p.m. ET. Here are some tips to prepare for the process:

1. Check your credit report. It’s important to check your credit report before your lender does, in case there are errors that could impact not only whether you get preapproved but also your ability to get the best mortgage rate. Knowing your credit score also helps you decide what type of loan to apply for. If your score is in the very low 600s, for instance, an FHA mortgage might be best for you, as its standards are more lenient than those for conventional loans.
2. Gather personal and financial documents. With any lender, you must supply documentation about your income, assets and debts. This includes pay stubs and W-2s and account and loan statements.
3. Provide details about the property. You’ll need to provide the address of the home and submit to an appraisal. (If you’re refinancing, you might or might not need an appraisal.)

Refinancing with Lower

Lower offers mortgage refinances for a flat fee of $1,695, although that cost is waived for existing borrowers. Refi candidates can apply online.

Frequently asked questions about Lower

What discounts does Lower.com offer?

By saving for a home in the Lower app, you can earn more than $1,000 in rewards toward closing costs. (User reviews of the app are mixed, however.) Lower matches each dollar saved up to $500, and the lender also offers rewards for setting up a recurring deposit and referring friends and family.

What is Free Refi for Life?

Lower borrowers qualify for the “Free Refi For Life” program, which waives the lender’s fees when you refinance.