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Sebonic Financial Mortgage Review: Excellent Technology and Low Down Payment Options

Review Updated
Kimberly Rotter, AFC®
Author: Kimberly Rotter, AFC®
Kimberly Rotter, AFC®
Kimberly Rotter, AFC®
Accredited Financial Counselor®

Kimberly is a career writer and editor with more than 30 years' experience. She's a bankruptcy survivor, small business owner, and homeschool parent. In addition to writing for The Motley Fool, she offers content strategy to financial technology startups, owns and manages a 350-writer content agency, and offers pro-bono financial counseling.

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Eric McWhinnie
Fact Checked: Eric McWhinnie
Eric McWhinnie
Eric McWhinnie

Eric McWhinnie has been writing and editing digital content since 2010. He specializes in personal finance and investing. He also holds a bachelor’s degree in Finance.

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Many or all of the products here are from our partners that compensate us. It’s how we make money. But our editorial integrity ensures that our product ratings are not influenced by compensation. Terms may apply to offers listed on this page.

Sebonic Financial is a nationwide mortgage lender that uses cutting-edge mortgage application technology. Sebonic's proprietary software makes the process easy to navigate and could help you close your loan faster. Sebonic doesn't give a ton of information online about its products, though. Read our Sebonic Financial mortgage review to find out if this might be the best mortgage lender for you.

Ratings Methodology
Sebonic Financial

Sebonic Financial

Rating image, 3.5 out of 5 stars.
3.5/5 Circle with letter I in it. Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor. We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
 = Best
= Excellent
= Good
= Fair
= Poor

Bottom Line

Sebonic's mortgage application experience shines, as do the low fees and diverse mortgage program offerings.

Min. Credit Score 550 for FHA Loans 620 for Conventional Loans

  • 550

Min. Down Payment 0% for VA and USDA loans 3.5% for FHA loans 5% for conventional loans

  • 0% for VA and USDA loans
  • 3.5% for FHA loans
  • 5% for conventional loans

Key Features

  • Cutting edge technology speeds up closings
  • All government-backed loans
  • Transparency with eligibility criteria

Loan Types

  • Conventional
  • FHA
  • VA
  • USDA
  • Jumbo
  • Interest Only

Fixed Rate Terms

  • Up to 30 years

Adjustable Rate Terms

  • N/A

Top Mortgage Lender

It's important to consider multiple mortgage lenders to find a good fit for you. We've listed one of our favorite lenders below so you can compare your options:

Lender Min. Down Payment Credit Score Next Steps
  • 0% - 3.5%
  • 580
Circle with letter I in it. 580 FHA 620 Conventional and VA 700 Jumbo
Apply Now for Better

Full Sebonic Financial mortgage review

This mortgage lender is a good fit for: Anyone who wants a smooth mortgage tech experience. Sebonic's technology makes the process easy -- and possibly faster. Sebonic Financial is also a good fit for borrowers who need a low down payment mortgage.

Pros

  • Quick close
  • Low fees
  • Wide selection
  • Transparency on eligibility

Cons

  • No home equity loan or HELOC
  • Hard to find rates

Top perks

Quick close

Sebonic Financial uses a proprietary app called Octane to manage mortgage applications. Octane's technology offers drag-and-drop functionality, e-signing capability, and real-time status updates throughout the process. This technology allows some borrowers to close their loans faster than they might with another lender. It's also really convenient. Sebonic Financial offers a remote closing in locations where it's permitted by law. If you're in one of those states, you can go from a rate inquiry to a mortgage application to the keys to your castle from the location of your choosing.

Low fees

Sebonic Financial does not charge an application fee. Even better, it also covers many of the fees other lenders tack on to your closing costs. Sebonic will not charge you for underwriting, processing, tax certification, or flood certification.

Sebonic does charge a $1,250 origination fee, but that fee is waived for repeat customers.

Wide selection of home loan options

Sebonic Financial offers a wide enough variety of loan types to meet the needs of most borrowers:

  • FHA loan for borrowers who need more flexible underwriting
  • VA loan for eligible servicemembers and government employees
  • USDA loan for lower-income borrowers buying in towns and rural areas
  • Conventional loan for anyone who qualifies
  • Interest-only loan for borrowers who plan to sell or refinance soon

What could be improved

Transparency on rates

Sebonic Financial doesn't publish mortgage rates on its website. That makes it hard for borrowers to shop around for low rates before they apply. If you want to know the rate, you'll have to fill out Sebonic's online form and agree to be contacted by a loan officer.

Although rates are far from the only factor to consider when choosing a mortgage lender, they do give you a starting point. We like it when this information is available without much work.

No HELOC or home equity loan

If you want to borrow against your equity, your only option here would be a cash-out refinance loan. There is no home equity loan or HELOC (at least, none that is advertised). That's disappointing if you are happy with your current mortgage and don't want to replace it with a new loan.

How to qualify

For a Sebonic Financial mortgage, most borrowers need at least a 620 credit score. If yours isn't that high, you might still qualify. Sebonic Financial says it can approve some FHA loan applicants with a 550 or higher credit score.

You won't need a down payment if you qualify for a VA loan or a USDA loan. Everyone else will need at least 3.5% down. Most lenders also want you to have one to three months' expenses in reserves, separate from your down payment. The cash reserves requirement can be met by a checking or savings account, retirement account (vested), trust account, certificate of deposit, other investment account, or cash value of a life insurance policy.

Debt-to-income (DTI) limits vary by loan, but can exceed 50%. Your DTI ratio is your required monthly debt payments divided by your pretax income. For example, if you earn $4,000 a month and your minimum debt payments amount to $1,600 a month, your DTI is 40%.

How are Sebonic Financial's refinance rates?

Sebonic Financial doesn't publish its refinance rates, but it lowers the overall cost of some of its loans by eliminating or reducing some fees.

How are Sebonic Financial's rates compared to the national average?

Sebonic Financial doesn't publish its mortgage rates, however, you can get a customized rate by speaking to a loan officer. When you shop, look at the APR instead of the interest rate. The APR represents the cost of the loan including interest and fees.

Sebonic Financial mortgage is right for you if:

Sebonic Financial is good for borrowers who want convenient technology and competitive pricing. Sebonic's size and nationwide reach mean it can afford to offer low rates and fees. Also, Sebonic is great for borrowers looking for low down payment mortgage options.

FAQs

  • Sebonic doesn't publish its rates. However, Sebonic mortgages might beat the competition when it comes to overall cost. That's because Sebonic waives many fees that other lenders charge.

  • Yes. Sebonic Financial is a large, well-established mortgage lender that can afford to offer competitive pricing on home loans. Plus, Sebonic has proprietary technology for managing your mortgage application. The platform makes the process easier and faster, and could help you close your loan in less time compared to other lenders.

  • Yes, especially if you already have a mortgage from Sebonic Financial. Sebonic waives the origination fee for repeat customers.

  • You'll need a credit score of at least 550 for an FHA loan or 620 for a conventional loan. If you qualify for a VA loan or a USDA loan you don't need a down payment, but everyone else will need at least 3.5% to 5%, depending on the loan type. The limit on your debt-to-income ratio will vary depending on the loan option that meets your needs. It's best if your DTI is under 36% but some borrowers will qualify with a DTI of 50% or higher.

  • Sebonic Financial offers a wide enough variety of loan options to meet the needs of most borrowers:

    • Conventional loan
    • FHA loan
    • VA loan
    • USDA loan
    • Jumbo loan
    • Refinance loan
    • Cash-out refinance loan