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finder.com’s rating: 3.7 / 5.0
★★★★★
Thanks to its flexibility, Flagstar is one of the highest-volume lenders in the US. Weigh its pros and cons to find out if it’s the right fit for your purchase or renovation.
620
Minimum credit score
3%
Minimum down payment (Conventional)
Available in all states
State availability
Loan products offered | Conventional, Jumbo, FHA, VA, USDA, Home Equity/HELOC, Refinance |
---|---|
Minimum credit score | 620 |
Minimum down payment (Conventional) | 3% |
State availability | Available in all states |
NMLS # | 417490 |
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Flagstar may be a great option for anyone looking for a construction or renovation loan and for those who want more flexibility in their loan terms. In addition to its 30-year and 15-year fixed-rate mortgages, Flagstar offers homebuyers the option to create a custom fixed-rate mortgage plan with terms available from 8 years to 30 years.
Flagstar’s rates are also competitive and the bank publishes them on its website, which makes things much easier for homebuyers shopping around and comparing lenders. But what you won’t find is any mention of its fees. We had to call and speak with a loan officer to get this information.
Flagstar has also been hit with a couple lawsuits in recent years, one of which was directly related to its mortgage practices. The other involved a recent data breach that exposed millions of customers’ sensitive information.
All considered, if you’re interested in a specialty mortgage of some kind or are looking for flexible loan terms, Flagstar is an option worth considering. But we recommend you continue to shop around before deciding, as several other lenders offer fewer fees and have stronger reputations.
Requirements to qualify vary based on the type of loan you’re applying for. Generally, you’ll need:
Flagstar may request:
Flagstar doesn’t disclose all its mortgage fees online, so we called to speak directly with a loan officer. The bank charges a flat $1,395 origination fee. At $1,395, it isn’t the most expensive lender fee we’ve come across, but it’s creeping into the higher end of the spectrum for lenders that charge a flat fee instead of a percentage of the total mortgage amount.
Homebuyers are also responsible for any additional third-party fees associated with securing a mortgage, so talk with your loan officer about fees before signing any paperwork. Common mortgage fees include:
Fill out the online form to kickstart the process. Once you’ve done that, you have the option of completing the application digitally or waiting for a callback from a loan officer.
Flagstar offers the following specialty mortgage loans:
Flagstar Bank holds an A+ rating with the Better Business Bureau (BBB) as of August 2022, but it isn’t accredited. Reviewers have rated the bank 1.04 out of 5 stars based on a total of 238 customer reviews. Dissatisfied customers largely complain about overall mismanagement and poor customer service.
Across other online forums, customers praise the personalized service from loan officers, and many name the officer who made their complicated process easier. For example, customer reviews on Zillow give Flagstar Bank 4.97 out of 5 stars based on more than 2,700 customer reviews. Customers also appreciate the construction and agricultural loans and the ability to lock in rates.
In 2012, Flagstar was sued for improperly approving home mortgages to get government insurance. Flagstar admitted to submitting false certifications to the US Department of Housing and Urban Development (HUD) and, as a result, agreed to reform its business practices and pay $132.8 million in damages and penalties under the False Claims Act.
In 2021, the company was hit with a class-action lawsuit for using an obsolete file transfer product that was breached, exposing the customer names, phone numbers, addresses, Social Security numbers, tax records and other banking information of over 1.47 million Flagstar customers. Flagstar agreed to pay $5.9 million to settle the lawsuit.
Flagstar offers all the traditional conventional and government-backed mortgages you’d expect to find at a bank its size, including home equity and jumbo mortgage products. But this lender won’t be right for everyone.
For starters, if Flagstar’s $1,395 origination fee is too steep, consider a digital bank like Axos Bank. It offers a similar range of mortgage products and will waive its $995 origination fee if you meet specific requirements.
If reputation matters most and you want to avoid paying lender fees altogether, consider Better or Beeline. These digital lenders consistently rank highly across the different review sites, and they don’t charge any lender fees. You just won’t find as comprehensive a list of mortgage products, and they’re not available nationwide.
Alternatively, compare top brands by home loan type, state availability and credit score. Select See rates to provide the lender with basic property and financial details for personalized rates.
Disclaimer: The partners on Finder's mortgage comparison tables are sorted in alphabetical order.