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Mr. Cooper mortgage review 2024
The Yahoo view: Mr. Cooper may be a good option for a conventional, FHA, VA, jumbo, or home equity loan. The mortgage lender’s strongest feature is probably its home-buyer incentives, including a one-year mortgage rate buydown, close-on-time guarantee, 120-day preapproval, and more. However, the company rates low in customer satisfaction for both servicing and originating loans.
Mr. Cooper, formerly known as Nationstar Mortgage, is a national mortgage lender based in Dallas. It offers loans in all 50 states, as well as Washington, D.C., Puerto Rico, and the U.S. Virgin Islands.
The company offers various loan options and several incentive programs that can reduce costs for home buyers and refinancers alike.
In this article:
Key benefits
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Mr. Cooper offers many home-buyer incentives, including a reduced mortgage rate for the first year and a close-on-time guarantee.
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There are several loan options, including conventional, FHA, VA, jumbo, and home equity loans.
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The company offers loans in all 50 states and several U.S. territories.
Need to know
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Mr. Cooper has no physical branches. You’ll need to apply online or over the phone.
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In late 2023, the company experienced a cybersecurity incident, and customer data was breached. A class action suit claimed the company improperly charged fees between 2018 and 2023.
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According to recent J.D. Power studies, it ranks below average in mortgage origination and servicing.
Mr. Cooper does not offer USDA loans or HELOCs.
Loan types offered
Mr. Cooper for first-time home buyers
Mr. Cooper has plenty to offer for first-time home buyers. It boasts a variety of loan programs, plus a 1% interest rate buydown option for the first year of your loan. This means if you qualify for a 6% rate, you’ll get a 5% rate for that entire first year, lowering your interest costs and monthly mortgage payments.
The lender also offers rate swaps — which allow you to take advantage of lower rates later on by refinancing with a waived mortgage origination fee of up to $1,500 — a verified preapproval option valid for 120 days, and a close-on-time guarantee. With this, Mr. Cooper will cover your first month’s mortgage payment (toward principal and interest) if your closing gets delayed.
Learn more: Best mortgage lenders for first-time home buyers
Mr. Cooper for home equity lending
Mr. Cooper offers home equity loans, which allow you to tap your home’s equity without refinancing. These are second mortgages that you take out in addition to your current mortgage, and you can use the funds for anything.
The lender also offers cash-out refinancing options. This is another tool you can use to borrow from your home equity, though it replaces your existing mortgage loan with a new one. This means getting a new interest rate and monthly payment too.
Dig deeper: What is a second mortgage, and how does it work?
Mr. Cooper mortgage rates
Mr. Cooper is fairly transparent about its interest rates. The lender has an entire page dedicated to its current rates, where you’ll find the interest rate and APR for 30-year, 15-year, and FHA 30-year loans displayed clearly in the center. Rates are updated daily.
However, once you click on “Legal disclosures,” you’ll see that the advertised interest rates each include nearly two mortgage discount points, resulting in a lower rate than if you didn’t purchase points at closing. Mr. Cooper doesn’t allow you to see what rate you’d get without points.
You can fill out an application to see the exact rate you’d qualify for. Mr. Cooper allows you to lock in your mortgage rate for 45 days.
Dig deeper: FHA vs. conventional loan — Which should you choose?
Applying for a mortgage with Mr. Cooper
Mr. Cooper has no physical locations, so to apply for a loan, you’ll need to fill out an online application or call one of the company’s mortgage experts over the phone. You can also apply for mortgage preapproval online through Mr. Cooper’s website.
Mr. Cooper home-buyer tools and calculators
Mr. Cooper offers a comprehensive help center that addresses many commonly asked questions — you can even search for a topic or use the live chat feature. The website also has calculators to help you do the following:
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Learning how much you could save by refinancing
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Calculating your monthly payment
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Paying off your loan early
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Comparing renting versus buying
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Determining your estimated loan amount
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Calculating how much house you can afford
Learn more: Use Yahoo Finance’s free mortgage payment calculator
How Mr. Cooper compares to other mortgage lenders
Mr. Cooper mortgages vs. Chase mortgages
Mr. Cooper and Chase are fairly comparable when it comes to mortgage loan programs, though Mr. Cooper has home equity loans, whereas Chase does not. Chase rates above Mr. Cooper in J.D. Power’s Mortgage Origination Satisfaction Study (and above average in general).
Both offer a variety of incentives for buyers. For example, you may be eligible for up to $7,500 in grant money from Chase, while Mr. Cooper has a one-year mortgage rate buydown option. Comparing each lender’s perks can help you decide which is the right fit.
Mr. Cooper mortgages vs. Rate mortgages
Rate (previously Guaranteed Rate) has several more loan options than Mr. Cooper, including a non-QM loan, medical professionals loan, and HELOC program. It also has physical branch locations if you want in-person service. Mr. Cooper rates slightly higher than Rate in J.D. Power’s rankings, though, and offers more buyer incentives.
Mr. Cooper mortgage FAQs
What is Mr. Cooper?
Mr. Cooper is a national mortgage lender offering loans in 50 states and several U.S. territories. It is based in Dallas.
Is Mr. Cooper legit?
Yes, Mr. Cooper is a legitimate mortgage company offering loans in all 50 U.S. states. It has an A+ rating with the Better Business Bureau.
Is Mr. Cooper going out of business?
Mr. Cooper is not going out of business, though it recently settled a class action lawsuit regarding improperly charged fees. The lender was ordered to pay $3.5 billion in damages.
What credit score do you need for Mr. Cooper?
Mr. Cooper doesn’t disclose its credit score minimums, but generally speaking, you need at least a 620 for a conventional mortgage. With FHA loans, your credit score can be as low as 500 (with a 10% down payment) or 580 (with a 3.5% down payment).
This article was edited by Laura Grace Tarpley
