Top perks
Transparency
Guaranteed Rate's website is extremely customer-friendly -- it's easy to navigate and find information. In very few clicks, you can find out which loans and terms are available, what loan might be right for you, and what today's mortgage rates are.
Guaranteed Rate offers a helpful feature that not all mortgage lenders provide. On its mortgage rates page, you can see how much your loan will cost with zero discount points versus one or two discount points. A mortgage discount point is prepaid interest. You pay a fee upfront and the lender lowers the interest rate. A point usually costs 1% of your loan amount, and the discount is typically one-eighth to one-quarter of one percent off your mortgage rate. The discount lasts for the life of the loan on a fixed-rate mortgage, or until the first rate adjustment on an adjustable-rate mortgage. If you don't keep the loan for at least a few years, paying for mortgage discount points might not make sense.
Technology
Guaranteed Rate Mortgage offers robust digital mortgage technology that can make the loan process easier and faster. Most loan documents can be signed online, and you can arrange to provide any required ink signatures in the location of your choice. Because so much can be completed in advance, the actual loan closing can be as brief as a few minutes.
Guaranteed Rate is also the Editors' Choice for Best Mortgage Lender App in 2022, an award issued by The Motley Fool's editorial team.
Down payment assistance programs
Guaranteed Rate participates in several low down payment programs designed to help borrowers get a home loan even if they can't make a 20% down payment. Those programs include:
- HomeReady®
- HomePossible®
- Fannie Mae 97%
- Freddie Mac HomeOne®
Home loans for lower credit scores
If you're otherwise ready for homeownership, don't assume that a lower credit score will necessarily prevent it. Guaranteed Rate offers VA loans (for service members, veterans, and some surviving spouses) that require a minimum credit score as low as 550. The lender also offers FHA loans (for anyone) with a minimum credit score of 560.
Neighborhood data
Guaranteed Rate can help you learn more about the neighborhoods you're interested in. Click "Housing market research" from the dropdown menu on Guaranteed Rate's website to go to the "Know your neighborhood" page. Enter a ZIP code or city name to find out what letter grade the area earns. The website returns detailed results, including market trends, population trends, and school data that can help inform your home search.
Construction loans
If you buy a new-build home before it's built, you'll need to make two housing payments -- one for the new home and one for the place where you'll live during construction. A common solution for this is a construction-to-permanent loan, which Guaranteed Rate offers. During construction, you only have to make interest payments, and only on the amount that has been disbursed to the builder. When the home is complete, Guaranteed Rate converts the loan to a traditional mortgage, and then you will begin making full payments.
Low-rate loan division
Guaranteed Rate has a division called Owning that offers extra low rates to qualified borrowers. If your credit score is at least 640, you're not self-employed, and you're not applying for a jumbo loan, you might be eligible for a streamlined mortgage with an interest rate that's 0.25% to 0.50% below the competition's rate.
What could be improved
Guaranteed Rate has many selling points and very few shortcomings. But these are two potential drawbacks we came across.
Not all loan options are listed
Guaranteed Rate has more options than are listed on its website. What this means is that (1) you might skip Guaranteed Rate, incorrectly thinking it doesn't offer what you want, and (2) you may have to talk to a loan officer to get all the information you seek. Doing that is virtually guaranteed to put you on a marketing list.
The last time we checked, Guaranteed Rate wasn't offering the USDA loan. But some of its brokers advertise it, so if you're looking for this program, it's best to call and ask.
Hard credit check fee
While most borrowers can get pre-approved with a soft credit pull, Guaranteed Rate may require some borrowers to undergo a hard credit check. In those cases, borrowers are responsible for the fee.
