Pennymac mortgage review: Waive $1,100 in origination fees on conforming, FHA, and VA mortgages
PennyMac; Rachel Mendelson/Insider
Personal Finance Insider writes about products, strategies, and tips to help you make smart decisions with your money. We may receive a small commission from our partners, like American Express, but our reporting and recommendations are always independent and objective. Terms apply to offers listed on this page. Read our editorial standards.
Overall lender rating
| Feature | Insider rating (out of 5) |
| Loan types | 3 |
| Affordability | 3 |
| Customer satisfaction | 3 |
| Trustworthiness | 5 |
| Total | 3.5 |
Pros and cons
| Pros | Cons |
|
|
Pennymac mortgage interest rates and fees
Pennymac makes it convenient to compare mortgage rates. If you click on "Rates" at the top left of the Pennymac website, you can view today's sample rates or use the instant quote tool to get rates customized to your situation. These customized rates are based on the price and location of the property you're purchasing, the size of your down payment, and your credit score.
Pennymac charges a $1,100 origination fee on its conforming and FHA mortgages. However, if you're purchasing a home rather than refinancing, or if you're getting an FHA streamline refinance, it may waive this fee for you.
Pennymac's VA mortgages come with an origination fee equal to 0.95% of the loan amount. If you're using a VA mortgage to purchase a home, it will reduce this fee by $1,100.
Pennymac vs. Rocket Mortgage
National Mortgage Professional | Rocket Mortgage |
Types of mortgages Conforming, FHA, VA | Types of mortgages Conforming, jumbo, FHA, VA |
Standout feature Instant rate quote tool | Standout feature Customer service |
To get personalized rates from Rocket Mortgage, you'll need to start an application. Pennymac, on the other hand, lets you easily explore rates without having to apply or create an account first.
Rocket Mortgage ranked No. 2 in J.D. Power's 2021 Primary Mortgage Origination Satisfaction Study, while Pennymac ranked below the industry average. If customer service is important to you, Rocket Mortgage might be a better choice.
Pennymac vs. LoanDepot
National Mortgage Professional | PR Newswire |
Types of mortgages Conforming, FHA, VA | Types of mortgages Conforming, jumbo, FHA, VA |
Standout feature Instant rate quote tool | Standout feature Physical branches in 44 states |
LoanDepot doesn't list any rates online, making it difficult to compare this lender to others if you aren't ready to apply for preapproval. By contrast, Pennymac's rate quote tool makes it easy to get an idea of what your rate might look like.
If you're a first-time homebuyer, you may also be able to put down less with Pennymac than with LoanDepot, which requires a down payment of at least 5%. Pennymac lets first-time homebuyers put down as little as 3%.
How Pennymac works
Pennymac is an online lender that originates mortgages in all states except New York. It offers conforming, FHA, and VA mortgages.
If you're a first-time homebuyer, you may be able to put just 3% down on a conforming mortgage with Pennymac. Other borrowers will need to put down at least 5%.
If you plan on getting an FHA mortgage, you'll need a credit score of at least 620 to qualify with this lender. This is higher than what many other lenders require on their FHA mortgages — typically, the minimum credit score is 580.
Pennymac doesn't consider alternative credit data (such as proof of rent or utility payments) on any of its mortgages. If you want to apply with this lender, you'll need a decent credit score.
If you're refinancing with Pennymac, you'll pay an origination fee of $1,100. If you're getting a VA mortgage refinance, the origination fee is equal to 0.95% of the loan amount. The origination fee is waived on conforming and FHA purchase mortgages and FHA streamline refinances, and is reduced by $1,100 on VA purchase mortgages.
If you want to apply for a mortgage, you can do so online. You can also get started over the phone Monday through Friday from 6 a.m. to 7 p.m. PT, and Saturday from 6 a.m. to 5 p.m. PT.
Is Pennymac trustworthy?
Pennymac has an A+ rating from the Better Business Bureau. BBB ratings are based on a company's response to customer complaints, honesty in advertising, and transparency about its business practices.
In J.D. Power's 2021 customer satisfaction study, Pennymac ranked below the industry average. However, the lender has good reviews on its Zillow profile.
Pennymac FAQ
What is Pennymac?
Pennymac is a private mortgage lender offering both conventional and government-backed mortgages.
What are Pennymac's rates?
You can see sample rates from Pennymac on its website, or you can use its instant rate quote tool to get a customized rate.
Does Pennymac offer home equity loans?
No, Pennymac does not currently offer home equity loans or home equity lines of credit (HELOCs).