NBKC mortgage review: Online lender offers low-cost VA loans and refinancing flexibility

Young family in kitchen, father looking up NBKC mortgage on his laptopImage: Young family in kitchen, father looking up NBKC mortgage on his laptop

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Updated December 15, 2020

This date indicates our editors’ last comprehensive review and may not reflect recent changes in individual terms.

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Written by: Clint Proctor

NBKC mortgage loans at a glance

  • Conventional loans: Yes
  • FHA loans: Yes
  • VA loans: Yes
  • Refinancing: Yes
  • Jumbo loans: No
  • Adjustable rates: Yes (3/1 ARM, 5/1 ARM, 7/1 ARM, 10/1 ARM)
  • Fixed rates: Yes (10, 15, 20, 25 and 30 years)

Founded in 1999, NBKC — short for National Bank of Kansas City — is an FDIC-insured bank that’s headquartered in Missouri. NBKC offers access to physical branches for residents of the Kansas City area and online banking to all other customers. It offers a variety of purchase and refinance loans, including VA loans, conventional loans and FHA loans.

Pros

  • Low-cost VA loans available
  • Available in all 50 states
  • Flexible refinancing options

Cons

  • No USDA or jumbo mortgages
  • Home equity loans limited to Kansas City residents

4 things to know about an NBKC mortgage

1. VA loans with no lender fees

NBKC offers VA loans on home purchases as well as VA Streamline Refinance loans. In terms of required origination costs, NBKC’s VA loans are very affordable. Its VA loans offer these cost-saving benefits.

  • No lender fees
  • No mandatory origination fees
  • No underwriting fees
  • No processing fees

But the VA requires NBKC to charge a funding fee to help offset the cost to taxpayers for these loans — which don’t require mortgage insurance. For purchase loans, the funding fee starts at 2.3% of the loan amount for first-time users who put down less than 5% and 3.6% for repeat borrowers.

If you’re a disabled veteran, you may qualify for a funding fee waiver. Otherwise, you can reduce the funding fee on your purchase loan by putting down larger down payments of at least 5% or 10%. And it should be noted that VA Streamline loans have a much lower funding fee (0.50%).

2. Availability

Where you live shouldn’t keep you from being able to apply for a home loan with NBKC. The bank offers these types of purchase and refinance loans in all 50 states.

  • VA loans
  • FHA loans
  • Conventional loans

If you live near Kansas City, you can take advantage of on-site origination assistance. But everyone else will need to communicate with their loan officer via phone and email. Kansas City residents are also the only borrowers who are able to take out home equity loans with NBKC.

3. Flexible refinancing options

With NBKC, you can refinance your mortgage to a lower interest rate to reduce your monthly payment, change your loan term or cash out some of your equity. It also offers two additional refinancing options that are a bit more unique: the FHA Streamline Refinance and the Refi Plus™ Program.

The FHA Streamline Refinance program allows people with FHA loans (who are current with their payments) to refinance with limited documentation requirements. These loans also don’t require an appraisal. But you can’t take out cash during the refinance process, and closing costs must be paid out of pocket rather than added to the loan balance.

If your current loan is held by Fannie Mae and you have a credit score of at least 620, you may qualify for the Refi Plus™ Program. These loans are designed to help Fannie Mae borrowers whose homes have decreased in value to avoid having PMI added after refinancing. You also may be able to finance up to 105% of your home’s current value.

4. Helpful tools and resources

You can get interest rate estimates on NBKC’s website without providing much personal information. NBKC is also transparent about its lender fees and how buying discount points could affect your mortgage rates. The rate you receive is customized by the following factors:

  • Home price
  • Down payment amount
  • State where the home is located
  • Your credit score range

In addition to its rate-check tool, NBKC’s site also offers a helpful homebuying Information Center and free financial calculators. It even provides a full Home Buying 101 PDF download that lays out the entire process of securing a mortgage in great detail.

Finally, NBKC can offer both prequalifications or preapprovals. The mortgage preapproval process is the lengthier of the two and requires documentation. But obtaining a preapproval letter could give you an advantage over other buyers if multiple offers are made on the same home.

Who is an NBKC loan good for?

NBKC is a good option if you’re looking for a low-cost VA loan lender. While VA home loans offer many benefits like no down payment or PMI requirements, the Veterans Administration does allow lenders to charge origination fees of up to 1% of your loan.

You won’t pay a VA loan origination fee with NBKC though. And there are no applications or procession fees, either. You’ll still want to compare NBKC’s VA loan interest rates with other lenders. But its loan fees (or lack thereof) may be hard to beat.

Since NBKC offers FHA loans in all 50 states, it could also be a good option for first-time homebuyers or any buyers who have limited credit or savings. And its Refi Plus™ option could make it a good choice if you’re looking to refinance with little to no home equity.

If you do have equity in your home, you can access a portion of it by applying for a cash-out refinance loan. But you won’t be able to take out a home equity loan if you live outside the Kansas City area. And you’ll have to look elsewhere if you need a jumbo loan or USDA loan.

How to apply for a NBKC mortgage

You can fill out the entire NBKC home loan application online. Here are some documents and information to have handy.

  • Your two most recent W-2s
  • Verification for all income sources
  • Two most recent bank statements
  • Records of all bank and investment accounts
  • List of all outstanding debts (for calculating your debt-to-income ratio)

Alternatively, you can call the NBKC customer service number to apply with a loan officer over the phone. You can even search through all of its loan officers by name and see their personal contact information. If you choose to apply online, a loan officer will still contact you shortly afterward and assist you moving forward.

Credit score requirements can vary by lender, but you’ll need a credit score of at least 580 to qualify for an FHA loan with a less than 10% down payment. And you’ll need a credit score of 620 or above to qualify for a conventional or Refi Plus™ loan.

Not sure if NBKC is right for you? Consider these alternatives.

If you’re shopping for a mortgage, you have a window of time where multiple credit inquiries by lenders are only counted as one in terms of impact on your credit scores. You typically have 14 days — though it could be longer depending on the scoring model.

  • Better Mortgage: This mortgage lender offers a 100% online mortgage process and charges no commissions or origination fees.
  • U.S. Bank: U.S. Bank could be a good option if you’re looking for a lender that can offer home equity loans and lines of credit to people in more geographic areas.

About the author: Clint Proctor is a freelance writer and founder of WalletWiseGuy.com, where he writes about how students and m… Read more.