Flagstar Bank Mortgage Review: Good for rate shoppers or special cases

Man and woman standing outside of their new home that they purchased with a Flagstar mortgageImage: Man and woman standing outside of their new home that they purchased with a Flagstar mortgage
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Flagstar Bank mortgage loan at a glance

  • Conventional loans: Yes
  • FHA loans: Yes
  • VA loans: Yes
  • Refinancing: Yes
  • Jumbo loan: Yes
  • Adjustable rates: Yes, with varying initial fixed periods
  • Fixed rates: Yes, from 8 years to 30 years

Flagstar Bank is a Michigan-based bank, originally opened in 1987. Today, the bank has roughly 150 branches in Michigan, Indiana, California, Wisconsin and Ohio. Flagstar is one of the nation’s largest home loan banks, with more than $27 billion in total assets.

Pros

  • Easy to compare rates
  • Licensed to lend in all 50 states
  • Offers several specialty mortgage loans

Cons

  • Limited physical locations
  • First-time homebuyer loan information is difficult to find
  • Not all products and services are available in all areas

6 things to know about a Flagstar Bank mortgage loan

1. Easy to compare mortgage rates

When you provide some information about the size and type of loan you’re seeking, Flagstar Bank offers you a mortgage rate quote for several loans it offers — from a standard 30-year fixed-rate loan to less-common adjustable-rate mortgages. The bank also gives you the monthly payment and mortgage insurance amount, which makes it easy compare quotes.

2. Licensed to lend in all 50 states

Flagstar Bank is authorized to close home loans in all 50 states. The bank operates out of more than 100 mortgage origination retail locations and has a network of more than 2,000 third-party originators.

3. Offers several specialty mortgage loans

If you’re looking to build a new home or if you’re buying a fixer-upper, Flagstar Bank offers construction and renovation loans. The bank also offers mortgages to buy multiple properties at once, which you may take advantage of if you’re an investor building a portfolio.

4. Limited physical locations

While Flagstar Bank can lend across the country, the bank doesn’t have staff on the ground in every state. In some parts of the U.S., you’ll have to go through its online or phone-based process to take out a mortgage. If you’re hoping for some in-person attention, you’ll want to make sure Flagstar has someone in your area.

5. No simple online prequalification

As you’re shopping for a mortgage, you may choose to prequalify for a loan to see what terms you’re offered. That’s not easy to do at Flagstar Bank. To start the process online, you need to fill out a contact form to get in touch with a Flagstar loan officer. You can then continue on to the full loan application online. This is helpful if you’re already committed to a Flagstar mortgage, but if you’re earlier in the process, you won’t get a simple online prequalification here.

Who is a Flagstar Bank loan good for?

With its easy-to-navigate rate quote system, a Flagstar Bank mortgage is worth checking out if you are early in the process and looking at what rates might be available. Flagstar shows you rates on a variety of different loans — as well as the monthly payment you can expect.

Flagstar Bank could also be a good fit for somebody looking for a mortgage that’s outside of the most-common types. The bank offers some adjustable-rate mortgages, jumbo loans, construction and renovation loans as well.

How to apply for a Flagstar Bank mortgage

Applying for a mortgage with Flagstar Bank starts by filling out a short form online. Once you answer a few questions about the type of mortgage you’re looking for, Flagstar pairs you with a loan officer who will get in touch with you.

From there, the loan officer can help you prequalify for a mortgage and give you an idea of the size of loan you’re likely to be able to receive. The loan officer will also help you decide which type of loan works best for you.

Once you’ve found the home you’d like to buy, you’ll go through the formal application. You can do this online, over the phone, by mail or in person if you live near one of Flagstar’s branches or loan centers. Be prepared to provide documents verifying your employment, income, assets and debts.

Once you’ve submitted all the documents Flagstar needs, your loan can be reviewed for final approval. If approved, you can close on the loan.

Not sure if Flagstar Bank mortgage is right for you? Consider these alternatives.

If you want to compare rates with several lenders or your application is denied, keep in mind that you have a window of time where multiple hard credit inquiries by lenders only count as one for your credit scores. You typically have 14 days — though it could be longer depending on the scoring model.

  • Better: If you’re looking for a seamless online experience, you may consider Better. Better also advertises that it doesn’t charge lender fees.
  • Wells Fargo: Among the country’s largest mortgage lenders, Wells Fargo boasts a nationwide network and offers a wealth of information online about its loan offerings.

About the author: Andrew Dunn is a veteran journalist with more than a decade of experience as a reporter and editor at North Carolina news organizations, including the Charlotte Observer and the StarNews… Read more.