Navy Federal Credit Union is a good option for people affiliated with the military because it offers a variety of mortgage products to fit the needs of different borrowers, including those with low credit scores and buyers who need low down payments. MoneyGeek's Navy Federal Credit Union loan review will help determine whether this lender is right for you.
MoneyGeek’s Take
2024 Navy Federal Mortgage Review | MoneyGeek.com
Updated: November 1, 2024
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At a Glance: Navy Federal Mortgages
- Navy Federal
- VA loans: 0% Military choice: 0% Conventional fixed rate: 0% Homebuyers choice: 0% Adjustable-rate mortgage: 0%–10% Minimum Down Payment
- VA loans, military choice, conventional fixed-rate, homebuyers choice, adjustable-rate mortgages, refinancing, second-home financing and investment property loansLoan Products Offered
- Available in all U.S. statesStates of Operation
- Yes Online Application
Navy Federal Credit Union is a full-service, nonprofit credit union that serves only military members, veterans and their families. Navy Federal Credit Union, headquartered in Vienna, Virginia, was founded in 1933 and currently serves over 11 million members via 350 locations globally.
Navy Federal Credit Union has over $160 billion in assets, $135.5 billion in savings, $97.9 billion in loans and $17.7 billion in equity. Aside from loans, Navy Federal offers a variety of banking and financial services, including credit cards and title services. Navy Federal Credit Union is not accredited by the Better Business Bureau (BBB) and does not have a BBB rating.
Incentives are available to members who use Navy Federal's mortgage services. For example, with its RealtyPlus tool, customers may get up to $9,000 in cash back when buying a property. This lender also provides a rate-match guarantee, paying you $1,000 or matching a lower rate from another lender.
Several Navy Federal home loans need no down payment and no private mortgage insurance. However, before qualifying for a mortgage, you must become a credit union member.
Pros
- No down payment option available for some loan products
- Fast online application
- Free rate lock option
- No private mortgage insurance (PMI)
- Rate match guarantee, or pays you $1,000
- Up to $9,000 back if you use the RealtyPlus tool
Cons
- Only available to military members and their families
- Requires membership
- Lender does not display personalized mortgage rates before borrowers apply
Navy Federal Credit Union is a full-service, nonprofit credit union that serves only military members, veterans and their families. Navy Federal Credit Union, headquartered in Vienna, Virginia, was founded in 1933 and currently serves over 11 million members via 350 locations globally.
Navy Federal Credit Union has over $160 billion in assets, $135.5 billion in savings, $97.9 billion in loans and $17.7 billion in equity. Aside from loans, Navy Federal offers a variety of banking and financial services, including credit cards and title services. Navy Federal Credit Union is not accredited by the Better Business Bureau (BBB) and does not have a BBB rating.
Incentives are available to members who use Navy Federal's mortgage services. For example, with its RealtyPlus tool, customers may get up to $9,000 in cash back when buying a property. This lender also provides a rate-match guarantee, paying you $1,000 or matching a lower rate from another lender.
Several Navy Federal home loans need no down payment and no private mortgage insurance. However, before qualifying for a mortgage, you must become a credit union member.
Navy Federal Mortgage Loan Types, Details and Requirements
Loan rates and terms vary depending on the lender and the type of loan. MoneyGeek reviewed Navy Federal Credit Union’s rates, fees and loan application requirements.
Mortgage Types Offered
Navy Federal Credit Union offers the following mortgage types:
- VA loans
- Jumbo
- Military choice
- Conventional fixed-rate
- Homebuyers choice
- Adjustable-rate mortgage
Navy Federal Credit Union offers additional mortgage options such as refinancing, second-home financing and investment property loans. However, it does not offer FHA and USDA loans.
Mortgage Rates
Navy Federal Credit Union mortgage rates depend on the loan type, amount, mortgage term, creditworthiness, loan-to-value (LTV), occupancy and loan purpose, so your rate and terms may differ. The credit union’s website publishes the most up-to-date rates.
Additional Fees
Navy Federal Credit Union does not charge processing or underwriting fees, nor does it charge a fee to relock your rate on purchases or refinances; nevertheless, additional costs may apply.
- Origination fees: Navy Federal Credit Union homebuyers choice, military choice and investment property mortgages require a 1.00% loan origination fee. However, you may substitute the origination fee for a 0.25% increase in the interest rate.
- Funding fees: The credit union charges a funding fee of 1.75% of the loan on both homebuyer and military choice loans. You can finance this funding fee into the loan up to a maximum loan to value ratio of 101.75%, or you can waive it for a 0.375% interest rate increase.
Minimum Borrowing Requirements
Although Navy Federal Credit Union does not advertise minimum credit score criteria on its website, it does assess customers's creditworthiness before processing loan applications.
According to MoneyGeek’s research, Navy Federal Credit Union does not require down payments for some loan products, such as VA loans, military choice and homebuyers choice.
Meanwhile, the lender requires a 5% down payment for conventional fixed-rate mortgages and a 0%–10% down payment for adjustable-rate mortgages.
Navy Federal Mortgage Application Requirements
Navy Federal Credit Union requires loan applicants to provide the following documents to verify the information on their application:
- 1
Date of birth
- 2
Social Security number
- 3
Navy Federal Share Savings account number
- 4
Two-year address history
- 5
Two-year work history
- 6
Gross monthly income
- 7
Any other income to be considered
- 8
Deposit account and asset information held by financial institutions other than Navy Federal Credit Union
- 9
Current tax, homeowners/condo dues, insurance and lien information
Depending on the type of mortgage you're applying for, you may need to provide additional information. For example, applicants for VA loans must provide a certificate of eligibility.
Self-employed applicants are required to provide the following additional documents:
- 1
W-2 forms and personal tax returns from the last two years
- 2
Pay stubs from the previous two months
- 3
List of monthly expenses (bills you pay each month)
- 4
Two months of bank, retirement and investment account statements
- 5
The two most recent years of personal 1040 tax returns with all pages, schedules and worksheets
- 6
The two most recent years of business tax returns:
- Partnership: Schedule K-1 (Form 1041), Partnership Income Tax Return (Form 1065)
- Sole Proprietorship: Schedule C of personal tax return
- C-Corp: Form 1120, most recent two years with all schedules
- S-Corp: Form 1120S, most recent two years with all schedules, Schedule K-1 (Form 1041)
- 7
Copy of business license or a written statement from a CPA confirming at least two years in business
Is Navy Federal Right for You?
The best mortgage loan lender for you depends on your individual needs. MoneyGeek’s Navy Federal Credit Union review will help you determine if the lender is the best option for you.
Who Navy Federal Is Perfect For
Navy Federal Credit Union is excellent for those with military affiliations. If you are not a military member, you may still be eligible if you are qualified to become a Navy Federal member. Members looking for a mortgage with no PMI or down payment and those seeking a lender with VA loan expertise will find Navy Federal a good fit.
Who Should Not Choose Navy Federal
People who do not have military ties are not eligible for Navy Federal mortgage loans. Furthermore, Navy Federal may not be a good option for people searching for government-backed loans because the company does not offer FHA or USDA loans.
How to Apply for a Navy Federal Mortgage Loan
MoneyGeek's Navy Federal Credit Union review outlines the lender’s step-by-step mortgage application process.
- 1
Prequalify
Navy Federal Credit Union allows prospective borrowers to see if they prequalify for a mortgage loan and for what amount. This lender uses your credit score, income, assets, debts, employment history and other financial information to determine preapproval. Navy Federal will request documents to validate this information later in the mortgage process.
- 2
Fill Out Application Form
You can proceed to find a property to buy (if you don't already have one) after you've prequalified and the provider has preapproved your application. Once you provide Navy Federal with a property address, your preapproval becomes a mortgage loan application.
- 3
Wait for Pre-Approval
After the lender receives all of your documents, your application will be processed to ensure everything is in order. An underwriter will conduct one last check to guarantee the financial viability of your loan. Note that Navy Federal may request additional information or documents to clear up any outstanding questions. Afterward, your loan will receive final approval and move to close.
- 4
Review Closing Disclosure
You'll get your closing disclosure at least three business days before your closing date, allowing you time to double-check for errors. It will contain your interest rate, loan type, loan term, monthly payments and closing fees. Call or email your loan officer to acknowledge receipt as soon as you receive the closing disclosure.
- 5
Sign Closing Disclosure
Pay your closing fees through wire transfer or cashier's check once you're satisfied with the closing disclosure. Then sign the closing disclosure.
- 6
Closing
You will sign your last set of paperwork and finalize the process on closing day. Before signing, carefully read the information.
- 7
Make Payments
Navy Federal offers borrowers various options for making mortgage payments; you may either set up automated payments from your preferred account or divide the monthly amount due into smaller, more frequent installments to lower your interest payments over the life of your loan.
You can also use the flex drafting option, which allows you to make half of your monthly payment on the first and 15th of each month to align with most military and government pay schedules. You can make one-time payments via the lender's online banking or mobile app, pay by phone or in person at a Navy Federal bank or ATM.
What to Do if You Are Rejected by Navy Federal
Prequalification isn't a guarantee that Navy Federal will approve your mortgage application. If your application is rejected, it's essential to understand why so you can correct any issues before you apply again.
You might be rejected because your credit score is below the required minimum, or the lender is concerned that you lack the financial resources to make the monthly mortgage payments.
Get in touch with a Navy Federal Credit Union customer care representative or loan originator if you find yourself in this situation. They can also help you figure out your options.
Frequently Asked Questions About Mortgages From Navy Federal
MoneyGeek answers the most commonly asked questions about Navy Federal mortgages to help you determine if it’s the best option for you.
What types of properties are eligible for Navy Federal mortgage loans?
Navy Federal loans apply to various property types, including two-unit properties, townhouses, condos and houses.
Who can apply for a Navy Federal mortgage?
People with a military affiliation, including military personnel, veterans and their families.
What types of mortgage loans does Navy Federal offer?
Navy Federal offers several loan types, including VA loans, military choice, conventional fixed-rate, homebuyers choice and adjustable-rate mortgages.
Is there a borrowing limit for Navy Federal mortgages?
Navy Federal's standard conforming loan maximum is up to $510,400. The conforming loan maximum in Alaska and Hawaii is $765,600. For jumbo or military choice loans, the maximum loan amount is $1,000,000.
What is the minimum down payment Navy Federal will accept?
Depending on the type of mortgage loan, borrowers can put down as little as 5% for conventional fixed-rate mortgages and 0%–10% for adjustable-rate mortgages.
Does Navy Federal require private mortgage insurance (PMI)?
Navy Federal does not require PMI.
Does Navy Federal require a property appraisal?
Yes, Navy Federal loans require a recent appraisal of the interior and exterior of your home.
About Christopher Boston
Christopher (Croix) Boston was the Head of Loans content at MoneyGeek, with over five years of experience researching higher education, mortgage and personal loans.
Boston has a bachelor's degree from the Seattle Pacific University. They pride themselves in using their skills and experience to create quality content that helps people save and spend efficiently.
sources
- Better Business Bureau. "Business Profile for Navy Federal Credit Union." Accessed September 18, 2024.
- Consumer Financial Protection Bureau. "What Is a Loan-to-Value Ratio and How Does It Relate to My Costs?." Accessed September 18, 2024.
- Navy Federal Credit Union. "About Us." Accessed September 18, 2024.
- Navy Federal Credit Union. "Closing on Your Mortgage." Accessed September 18, 2024.
- Navy Federal Credit Union. "The Mortgage Process." Accessed September 18, 2024.
- Navy Federal Credit Union. "Mortgages FAQs." Accessed September 18, 2024.
- Navy Federal Credit Union. "Mortgage Rates." Accessed September 18, 2024.
- Navy Federal Credit Union. "Mortgages." Accessed September 18, 2024.
- Navy Federal Credit Union. "Why Choose Navy Federal." Accessed September 18, 2024.
- Navy Federal Credit Union. "Special Update for Mortgage Applicants." Accessed September 18, 2024.
- Navy Federal Credit Union. "How to Make Mortgage Payments." Accessed September 18, 2024.
- Navy Federal Credit Union. "Navy Federal Credit Union 2022 Fact Sheet." Accessed September 18, 2024.