The Yahoo view: Third Federal may be a good option for a home buyer looking for incentives to sweeten the pot — things like low closing costs, first-time buyer credits, down payment assistance, or no-PMI options. However, the company does not offer government-backed loans and serves just 26 states.

Third Federal Savings & Loan is a financial institution serving 26 states and Washington, D.C. It opened in 1938 and has physical branches in Ohio and Florida.

The bank offers several mortgage products, including conventional, jumbo, and home equity loans, though it does not have government-backed options like FHA, USDA, or VA mortgages. Third Federal’s standout is its robust suite of borrower incentives, which include a flat-fee closing cost option (just $395 to $595), a buy-now-refinance-later program, a lowest-rate guarantee, up to $13,000 in down payment assistance (the amount varies on your location), and its $750 first-time buyer credit. It also offers unique options like a 10-year fixed-rate mortgage term, a relock option on adjustable-rate loans, and no private mortgage insurance (PMI) with at least a 15% down payment.

Key benefits

• The lowest-rate guarantee ensures you get the lowest interest rate around (or $1,000).

• Low closing cost options, a first-time buyer credit toward closing costs, and down payment assistance are available.

• No PMI with 15% down on conventional loans. (Lenders usually require 20% down to avoid PMI.)

• Lock in your mortgage rate for up to 360 days.

• Optional five-year rate relocks on certain adjustable-rate loans.

• Several home equity options, including home equity loans and HELOCs.

• Buy Now, Refi Later program lets you refinance for free through 2027.

Need to know

• Only serves 26 states, plus Washington, D.C. These states are California, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New York, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina, Tennessee, Virginia, Washington, and Wisconsin.

• No government-backed mortgage programs.

• The Buy Now, Refi Later program is limited to homeowners in Florida, Georgia, Illinois, Indiana, Kentucky, Maryland, Michigan, Missouri, North Carolina, New Jersey, Ohio, Pennsylvania, South Carolina, Tennessee, and Virginia.

• Down payment assistance programs are available for mortgages up to $300,000 in Florida, Indiana, Kentucky, and Ohio.

Third Federal home loan product offerings

Third Federal Savings & Loan offers the following types of home loans:

• Purchase loans

• Fixed-rate mortgages

• Adjustable-rate mortgages

• Conventional loans

• Jumbo loans

• Bridge loans

• Renovation loans

• Refinancing

• HELOCs

• Home equity loans

Third Federal does not offer the following types of home loans:

• FHA loans

• USDA loans

• VA loans

• Interest-only loans

• Lot loans

• Construction loans

• ADU loans

• Second home loans

• Non-QM loans

• Investment property loans

• 1% down loans

• Buydowns

• Manufactured home loans

• Piggyback loans

• ITIN mortgages

• Medial professional loans

Learn more: What is a bridge loan, and how does it work?

Third Federal Savings & Loan for first-time home buyers

Third Federal doesn’t offer government-backed mortgages, like FHA, USDA, or VA loans, which first-time home buyers commonly use. However, it does have plenty of perks that new buyers will enjoy. There’s a $750 first-time buyer credit, a low-closing-cost option (between $395 and $595 up-front, depending on where you live), and a lowest-rate guarantee. This says Third Federal will beat any lower rate you can find out there — or pay you $1,000.

Third Federal offers down payment assistance, a Buy Now, Refi Later program that offers a free refinance through 2027, and a 60-day rate lock. You can even lock in your mortgage rate for up to 360 days if you provide Third Federal with 1% of your loan amount up-front.

Its adjustable-rate loans also come with optional relock periods. These let you lock in an interest rate for another five years (after your initial fixed-rate period) on a 3/1 or 5/1 ARM loan term. You can opt into this relock at any point.

Read more: Best mortgage lenders for first-time home buyers

Third Federal Savings & Loan for home equity lending

Third Federal offers both home equity loans and home equity lines of credit (HELOCs). Here’s how those two options differ.

Third Federal home equity line of credit

Third Federal’s HELOC lets you borrow up to $300,000 and comes with a 10-year draw period and 20-year repayment period. You must have a maximum 80% loan-to-value ratio for HELOCs of up to $200,000, and if you borrow more, other LTV ratio rules may apply. These can serve as a first- or second-lien loan and are only available on owner-occupied, primary residences.

Third Federal home equity loan

Third Federal also offers a variety of home equity loans, including five-, 10-, 15-, and 20-year fixed-rate loans and a 5/1 adjustable home equity loan with a maximum 30-year term. (Although your exact term options will depend on where you live.) The 5/1 adjustable loans allow you to borrow up to 80% of your home equity and offer an initial rate of around 0.50% lower than fixed-rate options.

Third Federal HELOC and home equity loan fees

Third Federal’s HELOCs have an annual fee of $95 and a minimum monthly payment of $100. The fees for its home equity loans are not disclosed.

Dig deeper: Home equity line of credit (HELOC) vs. home equity loan

Third Federal home mortgage loan rates 2024

In some ways, Third Federal is very transparent about its interest rates. For each loan product, the lender clearly displays both an APR and interest rate, and you can easily toggle between loan products and terms. The rates include an autopay discount but no discount points, giving you a better idea of what you would actually pay than if it factored in discount points (which many lenders do). You can also get a “rate confirmation” by providing a few quick details about your location and home purchase.

However, the sample rates aren’t very realistic. The lender’s advertised conventional rates (on non-jumbo loans) are based on a $165,000 loan amount and assume a 20% down payment. Jumbo loan rates are based on a $600,000 loan amount and also assume a 20% down payment. First of all, many borrowers can’t afford to put 20% down. Second, $165,000 is well below the typical cost of a home in America. Third, it doesn’t make sense that a jumbo loan assumes $600,000 because in 2024, jumbo loans are mortgages for $766,551 or more.

Read more: How to get the lowest mortgage rates possible

How Third Federal scores on mortgage rates and loan costs

Yahoo Finance uses 2023 Home Mortgage Disclosure Act data comprised of 10 million home loan applications to score mortgage lenders on issued mortgage rates and total loan costs. We score each lender on a scale of 1 (lowest) to 5 (highest).

For example, with mortgage rates, a lender with a lower score charged a higher-than-median mortgage interest rate for loans issued in 2023. A higher score would indicate a lender granted lower-than-median home loan interest rates to borrowers in 2023.

With total home loan costs, a lower score would indicate that a lender charged higher-than-median total home loan costs in 2023. A high rating would mean that a mortgage lender offered lower-than-median all-in home loan costs in 2023.

Third Federal home loan rates score: 5 out of 5 stars

Third Federal total loan costs score: 5 out of 5 stars

What this means: Third Federal offered a relatively low mortgage rate of 6.24% and a low total loan cost of $3,173.15 to borrowers in 2023.

Third Federal mortgage application

You can apply for a Third Federal mortgage online, over the phone, or at one of its physical branch locations in Florida or Ohio. According to the Third Federal's website, the process typically takes 30 minutes or less.

If you submit your application online, a loan officer will call you to verify the data. You will also receive an application kit soon after applying. This will include documents to sign and a list of income and financial documentation you must submit to Third Federal. This should include pay stubs, W2s, and tax returns.

Third Federal mortgage preapproval

Third Federal offers fully underwritten preapprovals, which means you’re essentially already approved for the loan. This also ensures your quoted rate and loan amount are accurate before you start shopping for a home, and it can give you a leg up over other buyers.

You’ll need to fill out the lender’s full loan application to get preapproved. Then, when you find a house, you’ll send Third Federal a copy of your purchase agreement and pay your application fee — then your application will convert to a full application and start going through underwriting.

Read more: How the mortgage underwriting process works

Third Federal mortgage calculators and home-buying tools

Third Federal offers a plethora of online tools and resources. There’s a guides section, which walks you through various processes like refinancing, buying a home, and using your home equity. There is also a FAQs section and a borrower help center. At the help center, you can get advice, monitor interest rates, seek application assistance, or enroll in a home-buying seminar.

The lender also offers over two dozen online calculators, covering everything from buying a home to saving for retirement. Twelve of these calculators are directly related to home loans and can help you set your home-buying budget, determine the best loan option, calculate refinance savings, determine your break-even point, and more.

Learn more: Use the free Yahoo Finance mortgage payment calculator

Third Federal mortgage pros and cons

Pros

• Low rates and fees. Third Federal offers lower rates and total loan fees than industry medians, according to government data. It gets 5 stars in both categories.

• Great online resources. The lender offers over two dozen calculators, several guides, a borrower help center, FAQs, and more, giving it 4 stars in our Online Features category.

Cons

• Lacks many affordable loan programs. The lender offers down payment assistance and home equity products — but it lacks the basic government-backed options, giving it 3 stars in this category.

• Lacks transparency about rates. You’ll find sample rates for every product Third Federal offers, and no discount points are included on any. However, its rates are based on a $165,000 home and 20% down payment, and it doesn’t display the credit score assumptions. It earns a 2 for Rate Transparency.

• Only serves about half the nation. Third Federal currently operates in 26 states, plus Washington, D.C.

How Third Federal Savings & Loan compares to other mortgage lenders

Third Federal mortgages vs. Chase mortgages

At the product level, Chase has more options for borrowers, as it offers government-backed options like FHA and VA loans (while Third Federal does not). If you need to tap your home equity though, Third Federal is your go-to. Both lenders offer cash-out refinancing, but only Third Federal offers home equity loans and HELOCs.

Chase mortgage review

Third Federal mortgages vs. Bank of America mortgages

Bank of America offers more mortgage products than Third Federal, and its closing cost and down payment assistance programs are robust. It also has a larger footprint than Third Federal, allowing it to serve more borrowers.

To its credit, Third Federal does have a home equity loan, while Bank of America does not, and its suite of online calculators is more comprehensive. Third Federal’s advertised rates also exclude discount points (Bank of America’s do not).

Bank of America mortgage review

Third Federal mortgage FAQs

What are Third Fedeal’s mortgage rates today?

We looked at Third Federal interest rates in Ohio. On the day of writing, rates on a 30-year fixed-rate mortgage currently range from 6.49% to 6.89%, while those on 15-year mortgages start at 5.99% and go up to 6.39%.

Is Third Federal a real bank?

Third Federal is a legitimate bank that has been open since 1938. It serves 26 states and Washington, D.C.

Is Third Federal a good mortgage company?

Third Federal has an A+ rating with the Better Business Bureau and no recent regulatory actions against it. Its rates and loan fees are lower than industry medians.

Methodology:

Yahoo Finance reviews and scores mortgage lenders with quintile scoring in five primary categories: 1) Interest rates. Using 2023 Home Mortgage Disclosure Act data comprised of 10 million home loan applications, we score mortgage lenders on issued mortgage rates below or above the annual median of reporting lenders. 2) Affordability. A measure of loan product availability and the willingness of a lender to offer government-backed loans, low down payments, down payment assistance, and consideration of nontraditional credit. 3) Loan costs. HMDA data is again analyzed, and lenders are rated based on total loan costs compared to the annual median. 4) Rate transparency. The ability of a website user to obtain a mortgage interest rate estimate. We score lenders based on whether rates are enhanced with discount points or high credit score requirements, disclaimers revealing rate assumptions, sample advertised rates, and whether adjustable or no discount point rate estimates are available. 5) Online features. An analysis of the educational material, calculators, and additional resources available to users.

Review of Nationwide Multistate Licensing System (NMLS) data on regulatory actions can trigger a penalty to the score of any lender with a consumer mortgage-related administrative or enforcement action within the past five years.

Advertisers or sponsorships do not influence ratings.

Editorial disclosure for mortgages:

The information in this article has not been reviewed or approved by any advertiser. The details on financial products, including interest rates and fees, are accurate as of the publish date. All products or services are presented without warranty. Check the lender's website for the most current information. This site doesn't include all currently available offers.

This article was edited by Laura Grace Tarpley.