PennyMac Mortgage Review 2020

By Natalie Campisi

About our reviews

Bankrate’s editorial team researches, reviews and rates lenders to help you find one that fits your needs. Our experts consider a range of factors, including rates, loan types, time to close, fees and more. Reviews are updated regularly. Bankrate is an independent, advertising-supported comparison service. Our editorial team receives no direct compensation from advertisers, and our content is thoroughly fact-checked to ensure accuracy.

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4.5

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Please note: In response to the coronavirus pandemic, lenders are changing their requirements continuously. Although we strive for accuracy at the time of publication, please be sure to check with the lender for updated details on down payments, credit scores, etc.

PennyMac, headquartered in Westlake Village, California, was founded in 2008. Today, it’s a publicly traded national lender. Although there are sales office locations, borrowers must apply online or by phone. PennyMac is a direct lender that offers a wide range of loan options as well as a first-time homebuyer program with a low down-payment requirement (as little as 3 percent down). PennyMac also has refinancing options, plus home equity loans, HELOCs and streamline refinancing. Customers can use PennyMac’s online portal and electronic documentation system to apply for a loan from anywhere. They also offer phone support at any point during the application process. Once approved, borrowers are matched with a loan officer who becomes the single contact throughout the closing process. PennyMac offers both purchase and refinance loans that cater to various borrowing needs. This includes people with both excellent and average credit, investors, veterans, existing homeowners and first-time buyers. PennyMac not only originates loans, but it also buys loans and offers loan modifications in an effort to help borrowers stay in their homes. PennyMac will help reconfigure loans to make them more manageable for borrowers when possible. In addition to lending, PennyMac services loans, with more than 1.5 million PennyMac home loan customers on their books.

Nationwide availability

Available in all 50 states.

Minimum credit score

  • 620 for conventional and VA loans
  • 580 for FHA loans
  • 700 for jumbo loans

Loan types

Conventional mortgages FHA, VA and USDA loans, jumbo loans, adjustable-rate loans, Investment property loans

Pros

  • Online and phone customer service available to borrowers
  • Loan options include fixed-rate, adjustable-rate (ARM), flex-term, investment property, VA, FHA, USDA and jumbo mortgages
  • First-time homebuyer program with a low down-payment requirement (as little as 3 percent down)
  • Offers loan modification programs for eligible borrowers
  • Mortgage refinancing options, including streamline refinancing
  • Works with some employers to offer loan discounts
  • Offers a guarantee that they will close on time or the borrower gets a $500 Visa gift card (provided the late closing is the fault of PennyMac).

Cons

  • No brick-and-mortar locations
  • Customer service call center hours are limited
  • Online information about loan costs is limited

Find your mortgage match

Get paired with your best mortgage offers in 2 minutes or less.

PennyMac overview

Loan types

  • Conventional mortgages
  • FHA, VA and USDA loans
  • Jumbo loans
  • Adjustable-rate loans
  • Investment property loans

Lender fees

PennyMac loan fees include origination fees, rate-lock fees and closing costs. These expenses vary by loan type and applicant. According to PennyMac’s website, borrowers should talk to their loan officers about fees to minimize upfront costs.

Closing costs include things like title fees, recording fees, appraisal fees, credit report fees, pest inspection, attorney’s fees, taxes and surveying fees.

PennyMac offers a “better rate promise” program which asserts that their pricing is better than other lenders. They back this promise with a $250 gift card for borrowers who find cheaper lenders.

“The closing cost of a loan will vary depending on your geographic location and the requirements of the loan product,” according to PennyMac.

Minimum borrower requirements

PennyMac adheres to the conforming loan requirements for mortgages approved by government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, as well as those backed by the Federal Housing Administration (FHA) and the Department of Veterans Affairs (VA).

For conventional loans, key requirements include good credit (typically a FICO score of 620 or higher) and a minimum down payment of 3 percent. However, anything less than 20 percent down will trigger the private mortgage insurance (PMI) requirement. Borrowers must also have a minimum of two months cash reserves to cover the closing costs; proof of employment or income; and, in most cases, a debt to income ratio (DTI) of 45 percent or less.

Keep in mind, you might be able to submit alternative credit data to improve your chances of getting a lower interest rate or just getting approved for a loan. Alternative credit data includes rental history and car payments.

For FHA, VA and USDA loans, those requirements are set by the government. You can find them here:

FHA loan requirements

VA loan requirements

Refinancing options include home equity loans, HELOCs and streamline refinancing.

 

Get started with PennyMac

Borrowers can apply online or by phone. There are no brick-and-mortar locations where borrowers can apply in-person. Their online portal, called m.a.c. (mortgage access center), is where borrowers can submit required documents electronically.

Hours

Monday-Friday 6 a.m. to 7 p.m. (Pacific)

Saturday 6 a.m. to 5 p.m. (Pacific)

(866) 549-3583  

PennyMac consumer rating and reviews

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