Mr Cooper's Construction Loan Options: What You Need To Know

Mr. Cooper is a large national mortgage lender that offers a range of loan options, including conventional loans, investment property loans, and FHA and VA loans. The company also provides a Close on Time Guarantee for borrowers purchasing a new home with a conventional loan. While Mr. Cooper does not offer a wide variety of loan options, it does provide all of the most popular types of mortgages, such as conventional loans, FHA loans, and VA loans. Mr. Cooper also offers home equity loans, which can be useful for remodels and repairs. However, the company does not offer USDA loans or niche mortgage types. So, does Mr. Cooper provide construction loans?

Mr Cooper's construction loan options

Mr. Cooper is a legitimate mortgage lender that offers loans in all 50 states, Washington, D.C., Puerto Rico, and the U.S. Virgin Islands. The company is a non-bank lender and servicer that offers a range of mortgage options, including low-down payment conventional loans, investment property loans, and FHA and VA loans, along with free 45-day rate locks. Mr. Cooper also has a Close on Time Guarantee, which reimburses you for the first month's principal and interest if the mortgage doesn't close on or before the specified date.

While Mr. Cooper offers a variety of mortgage options, it does not provide construction loans. However, the company does provide home equity loans, which can be used for remodels and repairs. These loans allow you to access your home's equity without losing the rate on your first mortgage, making it easier to get cash for projects such as construction or renovation.

Mr. Cooper's home equity loans are available to borrowers who meet certain requirements. The company does not disclose minimum loan amounts, but each loan is subject to underwriting approval based on the product type. Borrowers typically need a credit score of at least 620 for conventional loans and 580 for FHA loans. Down payment requirements vary, with as little as 3% down for conventional loans and 3.5% for FHA loans.

It's important to note that Mr. Cooper's rates and fees can be higher than those of other lenders. The company's origination fees, in particular, can be significant, averaging $6,895 in 2023. Additionally, Mr. Cooper's rates tend to fall on the high end compared to other national mortgage lenders, with an average total cost of $10,138 across all loan types in 2023.

Overall, while Mr. Cooper does not offer construction loans specifically, its home equity loans can be a viable option for those seeking funding for construction or renovation projects. Borrowers should carefully review the requirements, rates, and fees associated with Mr. Cooper's loan products to determine if they meet their needs and financial circumstances.

Mr Cooper's loan rates

Mr. Cooper is an online mortgage lender that offers loans in all 50 U.S. states and Washington, D.C. The company offers conventional loans (conforming and jumbo), FHA loans, and VA loans. They also provide home equity loans, which allow homeowners to access their home's equity without losing the rate on their first mortgage.

Mr. Cooper does not display sample rates online, so to get an idea of their current rates, you will need to speak to a loan officer or start an application process. However, according to federal data and reviews, Mr. Cooper's interest rates are lower on average compared to other lenders. Additionally, Mr. Cooper offers a 1% discount on the first year's mortgage rate.

There are a few ways to get a lower home loan rate with Mr. Cooper. One way is to pay for discount points, where you pay fees directly to the lender in return for a lower interest rate. Another way is to get a mortgage buydown, which has become more popular as mortgage rates have increased.

Mr. Cooper offers both fixed-rate and adjustable-rate loans. A fixed-rate loan has an interest rate that never changes, providing the security of a consistent rate. On the other hand, an adjustable-rate loan (ARM) gives you the flexibility to take advantage of favourable changes in mortgage rates. For example, a "5/1 adjustable" loan offers a low fixed rate for the first five years, followed by one adjustment per year for the remainder of the loan.

When considering a loan, it is important to understand the difference between the interest rate and the annual percentage rate (APR). The interest rate is the percentage you pay to the lender for using their money, while the APR includes some of the fees on the loan, so it is typically higher.

Mr Cooper's loan fees

Mr. Cooper is an online mortgage lender that offers loans in all 50 states in the US and Washington, DC. While the company does not display sample rates online, it does provide a range of loan options, including conventional loans (conforming and jumbo), FHA loans, VA loans, and home equity loans.

Mr. Cooper's fees are considered to be on the high end. In 2023, the average borrower with a conventional mortgage paid $7,090 in origination charges, which include fees charged by the lender and optional costs like discount points. Mr. Cooper also offers a "RateSwap" program that waives the origination fee (up to $1,500) for any refinance within three years.

The company provides a Verified Approval process, which is similar to a mortgage preapproval but provides borrowers with more certainty about the amount they qualify for. This process requires borrowers to submit necessary documentation, such as pay stubs or tax returns, for an underwriter to review.

Mr. Cooper has received some negative press and was involved in a class-action lawsuit regarding illegal fees charged to customers, resulting in a $3.6 million settlement in 2024.

While Mr. Cooper's fees may be higher than some competitors, it offers a range of popular loan types and has received positive customer reviews, with a 4.2-star rating on Trustpilot based on over 6,000 customer ratings.

Mr Cooper's loan approval process

Mr. Cooper is a legitimate mortgage lender that lends in all 50 states, Washington, D.C., Puerto Rico, and the U.S. Virgin Islands. It is a non-bank lender and servicer with a focus on FHA loans and first-time homebuyers.

The loan approval process at Mr. Cooper involves the following steps:

Step 1: Start an Application or Contact a Loan Officer

To initiate the loan approval process, prospective borrowers can either start an application online or get in touch with a loan officer over the phone. Mr. Cooper does not have physical branch locations, so the entire application process is streamlined online.

Step 2: Provide Necessary Documentation

As part of the application process, borrowers will need to submit relevant documentation, such as pay stubs or tax returns. This documentation helps Mr. Cooper's underwriters accurately assess the borrower's financial situation and determine the loan amount for which they qualify.

Step 3: Receive a Verified Approval Letter

Mr. Cooper offers a Verified Approval, which is similar to a mortgage pre-approval but provides greater certainty. With this option, borrowers can receive an approval letter in as little as four hours, giving them a more precise estimate of their eligible loan amount.

Step 4: Explore Loan Options

Mr. Cooper provides various loan options, including conventional loans, investment property loans, FHA loans, VA loans, and refinancing options. They also offer loans for vacation or second homes and self-employed borrowers. The specific loan options presented to the borrower will depend on their qualifications and financial situation.

Step 5: Understand Rates and Fees

Mr. Cooper's interest rates are lower than most lenders, but their fees can be on the high end. They do not publicly disclose mortgage rates or fees, so borrowers will need to contact a loan officer to discuss personalized rates.

Step 6: Finalize the Loan

Once the borrower has selected a loan option and understood the associated rates and fees, they can work with Mr. Cooper to finalize the loan details and secure their financing.

It is important to note that Mr. Cooper's loan approval process may vary depending on individual circumstances, and additional steps or requirements may apply.

Mr Cooper's loan application process

Mr. Cooper is an online mortgage lender that offers loans in all 50 U.S. states and Washington, D.C. The company has lower-than-average mortgage rates and offers a range of popular loan types, including fixed or adjustable-rate mortgages, conventional mortgages (conforming and jumbo), FHA loans, and VA loans. They also provide loans for vacation or second homes and self-employed borrowers.

To initiate the loan application process with Mr. Cooper, you can either start an application online or discuss your options with a loan officer over the phone. If you choose to apply online, you will need to provide basic information such as your name, contact details, and the loan amount you are seeking. You may also be required to create an account on their website.

Once your initial application is received, a licensed mortgage professional from Mr. Cooper will contact you to discuss your available options and help determine if their loan offerings align with your financial goals. They will explain the loan process, answer any questions you may have, and guide you in making an informed decision.

Within three days of submitting your application, Mr. Cooper will provide a loan estimate outlining the anticipated closing costs. They will also send you loan disclosures, which include the essential terms, facts, and figures associated with your loan. It is crucial to carefully review these disclosures and understand the terms and conditions of your loan. You will then need to e-sign and return the disclosures, along with any additional requested documents. These supporting documents may include W2s, pay stubs, tax returns, bank statements, and other relevant paperwork based on your individual circumstances.

After submitting all the required documentation, Mr. Cooper will review your application and notify you of their decision. If your loan is approved, they will contact you to discuss the closing schedule. At this stage, you will work with a closing agent to finalise the loan by signing the necessary documents and paying the associated closing costs.

Mr. Cooper strives to make the loan application process straightforward and transparent, providing clear communication and guidance throughout.

Frequently asked questions