The Yahoo view: Mr. Cooper may be a good option for a conventional, FHA, VA, jumbo, or home equity loan. The mortgage lender’s strongest feature is probably its home-buyer incentives, including a one-year mortgage rate buydown, close-on-time guarantee, 120-day preapproval, and more. However, the company rates low in customer satisfaction for both servicing and originating loans.
Mr. Cooper, formerly known as Nationstar Mortgage, is a national mortgage lender based in Dallas. It offers loans in all 50 states, as well as Washington, D.C., Puerto Rico, Guam, and the U.S. Virgin Islands.
The company offers various loan options and several incentive programs that can reduce costs for home buyers and refinancers alike.
Read more: How to buy down your interest rate with a mortgage lender
Key benefits
Mr. Cooper offers many home-buyer incentives, including a reduced mortgage rate for the first year and a close-on-time guarantee.
There are several loan options, including conventional, FHA, VA, jumbo, and home equity loans.
The company offers loans in all 50 states and several U.S. territories.
Need to know
Mr. Cooper has no physical branches. You’ll need to apply online or over the phone.
In late 2023, the company experienced a cybersecurity incident, and customer data was breached. A class action suit claimed the company improperly charged fees between 2018 and 2023. The case was settled for over $3.5 million.
According to 2024 J.D. Power surveys, it ranks below average in both mortgage origination and servicing.
Mr. Cooper does not offer USDA loans or HELOCs.
Get started by visiting Mr. Cooper’s mortgage website.
Mr. Cooper offers:
Mr. Cooper does not offer:
USDA loans
Interest-only loans
Land loans
Construction loans
Guest house loans
Second home loans
Non-QM mortgages
Investment property loans
Energy-efficient mortgages
Renovation loans
1% down loans
Bridge loans
Manufactured home loans
Piggy-back loans
ITIN mortgages
Medical professional loans
HELOCs
Learn more: How to use a jumbo loan to buy a higher-priced house
Mr. Cooper has plenty to offer for first-time home buyers. It boasts a variety of affordable loan programs, plus a 1% interest rate buydown option for the first year of your loan. This means if you qualify for a 6% rate, you’ll get a 5% rate for that entire first year, lowering your interest costs and monthly mortgage payments.
The lender also offers up to $10,000 cash back if you use a recommended real estate agent, its preapprovals are valid for 120 days, and there’s also a close-on-time guarantee. With this, Mr. Cooper will cover your first month’s mortgage payment (toward principal and interest) if your closing gets delayed.
Dig deeper: Best mortgage lenders for first-time home buyers
Mr. Cooper offers home equity loans, which allow you to tap your home’s equity without refinancing. We’ll go more into these below.
The lender also offers cash-out refinancing options. This is another tool you can use to borrow from your home equity, though it replaces your existing mortgage loan with a new one. This means getting a new interest rate and monthly payment. This may not always work in your favor.
Learn more: Home equity loan vs. cash-out refinance
Mr. Cooper’s home equity loans are second mortgages that you take out in addition to your current mortgage. They let you borrow from your home equity, and you can use the lump-sum payment for anything.
You can only get a Mr. Cooper home equity loan on your primary residence, and your first mortgage must also be with Mr. Cooper. Your rate and loan amount will depend on your credit, debt-to-income ratio (DTI), combined loan-to-value ratio (CLTV), and home equity. These loans are not available in Texas, Vermont, New York, Washington, D.C., Guam, Puerto Rico, or the Virgin Islands.
Mr. Cooper doesn’t disclose all the fees associated with its home equity loans, though there can be an annual fee of up to $75 for opening a home equity loan with the lender. There can also be appraisal fees of up to $820, loan recording costs, and more.
Dig deeper: What is a home equity loan? A complete overview
Mr. Cooper is fairly transparent about its interest rates. The lender has an entire page dedicated to its current rates, where you’ll find the interest rate and APR for 30-year, 15-year, and FHA 30-year loans displayed clearly in the center. Rates are updated daily.
However, once you click on “Legal disclosures,” you’ll see that the advertised interest rates are based on a very high credit score, and each includes nearly two mortgage discount points, resulting in a lower rate than if you didn’t purchase points at closing. Mr. Cooper doesn’t allow you to see what rate you’d get without points.
You can fill out an application to see the exact rate you’d qualify for. Mr. Cooper allows you to lock in your mortgage rate for 45 days.
Learn more: Should you lock in a mortgage rate — and if so, when?
Yahoo Finance uses 2023 Home Mortgage Disclosure Act (HMDA) data made up of 10 million home loan applications to score lenders on issued mortgage rates and total loan costs. We score each lender on a scale of 1 (lowest) to 5 (highest).
For example, regarding mortgage interest rates, a lender with a lower score charged a higher-than-median mortgage interest rate for loans issued in 2023. A higher score indicates that a lender granted borrowers lower-than-median home loan interest rates in 2023.
With total home loan costs, a lower score would indicate that a lender charged higher-than-median total home loan costs in 2023. A high rating would mean a mortgage lender offered lower-than-median all-in home loan costs in 2023.
What this means: Mr. Cooper offered a relatively low mortgage rate of 6.25% and a high total loan cost of $10,030.30 to borrowers in 2023.
Mr. Cooper has no physical locations, so to apply for a loan, you’ll need to fill out an online application or contact one of the company’s mortgage experts over the phone. You can also apply for mortgage preapproval online through Mr. Cooper’s website.
Mr. Cooper offers online preapprovals. These require a soft credit check, which won’t hurt your credit score. This sets Mr. Cooper apart from other mortgage lenders, as most require a hard credit pull that impacts your score when you apply for preapproval. Your application also calls for some basic information about your income and assets.
You’ll then get a preapproval letter within minutes. These are valid for up to 120 days.
Dig deeper: What is mortgage preapproval, and why is it important for buyers?
Mr. Cooper offers a comprehensive help center that addresses many commonly asked questions, and you can even search for a topic or use the live chat feature for more help.
There is also a library of informative videos and six calculators to help you do the following:
See how much you could save by refinancing
Calculate your monthly payment
Learn how to pay off your loan early
Compare renting versus buying
Determine your estimated loan amount
Calculate how much house you can afford
Learn more: Use Yahoo Finance’s free mortgage payment calculator
Lots of online resources: The lender has a robust hub of articles and FAQs, six calculators, and a library of video content. It gets 5 stars in our Online Features category.
Low interest rates: According to government data, Mr. Cooper’s interest rates are low compared to industry averages.
Many affordable loan options: Mr. Cooper offers several affordable loan programs, including government-backed loans, buydown programs, and a home equity loan, which gives it 3 stars in our Affordability category.
Poor rate transparency: Mr. Cooper offers sample rates on its website, but these rates don’t accurately reflect what most borrowers will qualify for, giving it just 2 stars in this category.
High loan costs: Government data shows Mr. Cooper’s fees and total loan costs are significantly higher than industry averages.
Poor reputation: The lender has several lawsuits and regulatory actions against it, and it rates low in customer satisfaction for both mortgage origination and servicing.
Read more: How much do mortgage lender fees cost?
Mr. Cooper and Chase are fairly comparable when it comes to mortgage loan programs, though Mr. Cooper has home equity loans, whereas Chase does not. Chase rates above Mr. Cooper in both servicing and origination, according to J.D. Power, and above average in general.
Both offer a variety of buyer incentives. For example, you may be eligible for up to $7,500 in grant money from Chase, while Mr. Cooper has a one-year mortgage rate buydown option. Both offer close-on-time guarantees.
Chase mortgage review
Rate (previously Guaranteed Rate) has several more loan options than Mr. Cooper, including a non-QM loan, a medical professionals loan, a 1% down program, and a HELOC. It also has physical branch locations if you want in-person service. Rate ranks higher than Mr. Cooper in J.D. Power’s customer satisfaction ranking, though both are below average.
Rate also offers in-person branch locations, whereas Mr. Cooper does not, and its same-day mortgage allows for mortgage approval in just 24 hours.
Rate mortgage review
Mr. Cooper is a national mortgage lender offering loans in all 50 states and several U.S. territories. It is based in Dallas.
Yes, Mr. Cooper is a legitimate mortgage company offering loans in all 50 U.S. states. It has an A+ rating with the Better Business Bureau.
Mr. Cooper is not going out of business, though in 2024, it settled a class action lawsuit regarding improperly charged fees. The lender was ordered to pay over $3.5 billion in damages.
Mr. Cooper doesn’t disclose its credit score minimums, but generally speaking, you need at least a 620 for a conventional mortgage. With FHA loans, your credit score can be as low as 500 (with a 10% down payment) or 580 (with a 3.5% down payment).
It’s fairly common for mortgages to get transferred after closing. Fortunately, it does not change your loan’s term or rate; it simply changes the company you’ll pay monthly. Mr. Cooper currently has a servicing portfolio of over $1.2 billion.
Methodology:
Yahoo Finance reviews and scores mortgage lenders with quintile scoring in five primary categories: 1) Interest rates. Using 2023 Home Mortgage Disclosure Act data comprised of 10 million home loan applications, we score mortgage lenders on issued mortgage rates below or above the annual median of reporting lenders. 2) Affordability. A measure of loan product availability and the willingness of a lender to offer government-backed loans, low down payments, down payment assistance, and consideration of nontraditional credit. 3) Loan costs. HMDA data is again analyzed, and lenders are rated based on total loan costs compared to the annual median. 4) Rate transparency. The ability of a website user to obtain a mortgage interest rate estimate. We score lenders based on whether rates are enhanced with discount points or high credit score requirements, disclaimers revealing rate assumptions, sample advertised rates, and whether adjustable or no discount point rate estimates are available. 5) Online features. An analysis of the educational material, calculators, and additional resources available to users.
Review of Nationwide Multistate Licensing System (NMLS) data on regulatory actions can trigger a penalty to the score of any lender with a consumer mortgage-related administrative or enforcement action within the past five years.
Advertisers or sponsorships do not influence ratings.
Editorial disclosure for mortgages:
The information in this article has not been reviewed or approved by any advertiser. The details on financial products, including interest rates and fees, are accurate as of the publish date. All products or services are presented without warranty. Check the lender’s website for the most current information. This site doesn’t include all currently available offers.
This article was edited by Laura Grace Tarpley.
