First Internet Bank mortgage review
Get quality customer service, but only one specialty loan.
finder.com’s rating: 3.7 / 5.0
First Internet Bank was the first state-chartered, FDIC-insured bank and offers purchase and refinance mortgages that you can apply for online. But you’ll need to talk to a loan officer to finalize your deal.
|Loan products offered||Conventional, Jumbo, FHA, VA, Home Equity/HELOC, Refinance|
|Minimum credit score||620|
|Minimum down payment (Conventional)||3.5%|
|State availability||Available in all states|
Our take on First Internet Bank mortgage
As its name suggests, First Internet Bank is the first state-chartered, FDIC-insured institution to go 100% online. As an innovative bank, it prides itself on automated processes and a streamlined home loan application process, which can save you time.
Without the overhead costs of traditional lenders, First Internet Bank strives for competitive rates and quick, efficient service. But while it offers a range of mortgage products, including conventional and government-backed loans, its speciality offerings are slim compared to some other lenders.
Also, as a fully digital bank, you can’t walk into a branch to meet face to face with a loan officer about your loan application. Everything is handled online or over the phone.
First Internet Bank requirements
First Internet doesn’t disclose its credit score or other requirements, such as loan-to-value (LTV) or debt-to-income (DTI) limits, on its website. But typically, you’ll be required to have at least a 620 credit score. And with a 3.5% minimum down payment, your max LTV is 96.5%.
The DTI limit has been 43%, but recent rule changes from the Consumer Financial Protection Bureau have loosened this requirement.
The bank offers a preapproval process, so you’ll know your loan amount and qualifying rates before you go searching for a new home.
Be prepared to provide:
- Your full name and personal contact information
- Your Social Security number
- List of your assets, including savings, real estate, car titles and other investment records
- Complete list of your debts, including student loans, auto loans, personal loans and credit cards
- Recent paycheck stubs
- Your most recent federal tax return
Costs and fees
First Internet Bank doesn’t disclose exactly how much your mortgage-related fees cost until you apply. As a general rule, closing costs on a house tend to range from 2% to 5% of the home’s total cost. You can expect to pay the following fees:
- Third-party fees. These are collected by the bank but paid out to outside service providers and include appraisal fees, credit report fee, the settlement fee, tax service fees, title insurance, flood certification fees and courier or mailing costs. You’ll also need to pay state and local taxes and recording fees.
- Lender fees. These include discount points, document preparation and loan processing or origination fees.
- Prepaid items. Some costs need to be paid in advance to cover your first few months in the home. These fees include per diem interest, escrow deposit, two months of mortgage insurance (PMI) and the first year of your homeowner’s insurance premiums.
If you choose to pursue a home loan with First Internet Bank, your loan consultant should provide an estimate of the specific fees associated with your pending loan within three business days of submitting your application.
How to apply for a mortgage with First Internet Bank
The application and preapproval processes are identical, so which one you choose should depend on whether you have a home you’re ready to purchase or you want a preapproval letter to start your house search.
- Go to First Internet Bank’s website and choose Apply Now or Get Pre-Approved.
- Select Mortgage and choose Continue to enter your details to create an account.
- Follow the prompts to enter information about yourself, your debts and your assets, as well as the property you want to purchase.
- Choose Continue after reviewing your information at the end of each section.
- Answer declaration questions and enter your demographics information.
- Submit your application.
- Follow the instructions to upload the documents required to complete the preapproval process. Your loan officer may request additional information as they consider your application.
What types of mortgages can I get through First Internet Bank?
Other mortgage products offered by First Internet Bank
The only specialty mortgage loan this bank offers is a Construction-to-Permanent option that allows you to finance your home with a construction loan that converts to a permanent loan without charging you a second set of closing costs. Additionally, the bank offers an interest rate lock from eight to 12 months.
First Internet Bank reviews and complaints
Overall, reviews for First Internet Bank are limited. There are only seven customer reviews of First Internet Bank on Trustpilot as of October 2021, where the lender gets a TrustScore of 2.8 out of 5 stars. The lender fares better on ConsumerAffairs, where it gets a 5- out 5-star rating from 34 customers.
On the Better Business Bureau (BBB), it has an A+ rating for closing six customer complaints in the last three years. As for customer reviews on the BBB, the bank has 3.4 out of 5 stars with only five reviews as of October 2021.
On the plus side, customers speak highly of the courteous, responsive service they receive from their loan consultants and prompt processing times during the application process. Complaints describe long underwriting times and higher-than-advertised interest rates.
Pros and cons of First Internet Bank
- Excellent customer service. Reviews online mention First Internet Bank’s great customer service. When we contacted the company, we spoke to a representative within 40 seconds, with no automated routing system.
- Highly rated mobile app. First Internet’s mobile app lets you track your home loan account and payments and has a 4.4 rating from Google Play and a 4.8 out of 5 from Apple’s app store.
- No prepayment penalties. None of First Internet Bank’s loan programs charge prepayment fees, which means you can save unnecessary interest by paying off your mortgage early without penalty.
- Two-step application. While a majority of the home loan application takes place online, you’ll need to follow up with your assigned loan officer to complete the process.
- Fewer options. First Internet offers most of the conventional and government-backed loan products available but only offers one specialty loan.
What is First Internet Bank?
In 1999, First Internet Bank became one of the first FDIC-insured banks to operate without any physical branches. True to its name, First Internet Bank is a full-service bank that conducts its business entirely online.
It offers checking and savings accounts, CDs, IRAs, credit cards, personal loans and home loans — all digitally.
Alternatives to First Internet Bank mortgage
If you’re looking for a competitively priced conventional or government-backed mortgage loan, First Internet Bank might be a good choice. But its specialty mortgage options are limited to one, which is surprising for a bank best known for its innovative beginnings.
For a greater array of mortgage options — including land, construction, renovation, condo loans and more — lenders like Draper & Kramer Mortgage, North American Savings Bank and Stearns Lending have a wider selection of loans, in-person branches and great customer reviews, too.
If you want to save money on lender fees, consider other digital lenders like Beeline or Better. Both offer loans without lender origination fees, and a 24/7 online application process makes for a quicker loan application and turnaround.
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