Years ago, the modus operandi when it came to getting a mortgage involved walking over to your local bank. Now, thanks to the internet and a rapidly evolving financial services industry, prospective homebuyers have more options than ever before. Case in point: Nationstar Mortgage, a non-bank mortgage originator and servicer that does business via phone or email, with no brick-and-mortar branches in sight.
What Is Nationstar Mortgage?
Nationstar Mortgage is one of the largest nonbank mortgage servicers in the United States. Per its website, as of September 2016, Nationstar had 2.7 million customers and a servicing portfolio of $453 billion in unpaid principal balance. The company, launched over 20 years ago, also offers many types of home loans, including conventional fixed-rate mortgages, adjustable-rate mortgages (ARMs), Federal Housing Administration (FHA) loans, military (VA) loans, jumbo loans and U.S. Department of Agriculture (USDA) loans. Its headquarters are in Dallas, Texas.
How Does Nationstar Mortgage Work?
Customers can get the mortgage application process started by calling Nationstar or by filling out a form on the company website. If you submit a form via the website, a loan officer will call you within 24 hours. You’ll work with that officer for the rest of the process, submitting any documentation they need for your mortgage, like pay stubs, W2 forms and bank statements, via email. Note: You can’t set up an account online until you’ve officially become a Nationstar borrower — you need to enter your loan number on the signup page.
The Pros of Nationstar Mortgage
Once you have a mortgage, you can set up automatic payments online or via Nationstar’s mobile app, which is certainly convenient. Plus, the company recently updated its digital platforms, adding educational content, interactive data tools and payment modules. Most notable among these updates is Street Smarts, which Nationstar has dubbed a “digital home loan adviser that can deliver custom insights on a customer’s loan, home and neighborhood.”
Street Smarts provides Nationstar borrowers with their credit scores, an equity analysis of their home and customized payment options, among other things.
“We don’t want to just enhance our site’s functionality, or add a mobile app, we want to upgrade our customers’ experience and challenge the standard for customer service in the mortgage industry,” Jay Bray, Nationstar’s chairman and CEO, said in a press release.
The Cons of Nationstar Mortgage
Unlike a lot of non-brick-and-mortar mortgage lenders, you can’t simply apply for a mortgage online (you must submit the form or call the number to get the process started.) Plus, prior to the update, Nationstar wasn’t exactly known for rave reviews regarding its customer service. Back in July 2016, the company received just two power circles in J.D. Power & Associates’ 2016 Primary Mortgage Servicer Satisfaction Study, putting it squarely in the bottom of the pack among the 19 ranked lenders. (Three circles is considered “about average;” two stars is considered “the rest.”) It didn’t fare much better in J.D. Power’s November 2016 Primary Mortgage Origination Satisfaction Study, again netting only two stars, though its score of 772 out of 1,000 marked a 50-plus point improvement year-over-year in overall satisfaction.
The survey measures customer satisfaction among the largest mortgage originators in the U.S. using six factors: application/approval process; interaction, loan closing, loan offerings, onboarding and problem resolution. It was conducted from July to August 2016 and based on responses from 5,182 customers who originated or refinanced a new mortgage in the prior 12 months, before Nationstar made the updates to its digital platforms.
“We are proud to see our J.D. Power scores improve as they reflect progress on the journey we started two years ago to keep the dream of homeownership alive and reshape our customer service experience,” a Nationstar spokesperson said in an email.
Per the Primary Mortgage Servicer Satisfaction Study, specifically, they wrote “the survey reflected industry-wide improvements in servicing and, while we are happy our score improved by 28 points, we also know we can do more to improve the customer experience. Over the past year, we’ve been working with J.D. Power more proactively to identify opportunities for improvement, which has also heavily influenced our strategic planning.”
Vetting a Mortgage Lender
Remember, the right mortgage lender for you will depend on how you like to do business, your financial situation and what type of home loan you’re looking for. Still, when choosing a lender, be sure to ask some important questions, like what their rates, points and fees are, if an estimate of closing costs is available and how they earn income on your loan. You can learn how to find and choose a mortgage lender here.
And, no matter what company you choose, be sure to check your credit before applying. The best mortgage rates are reserved for those with a good credit score, so you’ll want to know where you stand — and if there’s anything you should be doing to improve it — ahead of the process. You can pull your credit reports for free each year at AnnualCreditReport.com and view your free credit report snapshot on Credit.com.