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Mr. Cooper mortgage review
Last updated:
finder.com’s rating: 3.5 / 5.0
★★★★★
A simple selection of home loans and US-based customer service.
Nationstar Mortgage rebranded itself in August 2017, and has since been doing business as Mr. Cooper. The mortgage provider has a small suite of home loans available, and boasts a couple of money-saving programs. But dubious customer experiences and former questionable practices make Mr. Cooper out to be less personable than the casual name might imply.
Details
| Loan products offered | Conventional, Jumbo, FHA, VA, Home Equity, Refinance |
|---|---|
| Minimum credit score | Conventional: 620 |
| Minimum down payment | 3% |
| State availability | Available in all states |
CFPB investigating unauthorized withdrawals
The Consumer Financial Protection Bureau (CFPB) issued a warning statement on April 27, 2021 about Mr. Cooper. Recent complaints state that Mr. Cooper has been debiting borrowers’ bank accounts multiple times, resulting in duplicate payments, overdraft fees and other losses.
While it is still investigating these withdrawals, the CFPB states that it will attempt to resolve the situation quickly. If your mortgage is serviced by Mr. Cooper, monitor your bank accounts and report any duplicate payments Mr. Cooper.
You can also submit complaints directly on the CFPB’s website.
What types of loans does Mr. Cooper offer?
Mr. Cooper offers a few basic products, but the suite is limited compared to its bigger-name competitors.
- Conventional mortgages. Adjustable (ARMs)- and fixed-rate mortgages are available through Mr. Cooper. You’ll find ARMs with fixed rates for 3, 5 and 10 years that are then adjustable on a yearly basis after. Fixed-rate options come in 15- and 30-year terms.
- Jumbo loans. When a loan amount exceeds the regional loan limits, you’ll need a jumbo loan. A higher down payment may be required for a jumbo loan, and you can expect to pay a higher rate.
- FHA loans. The Federal Housing Administration offers guarantees on mortgages for qualified borrowers. With government backing, eligibility requirements are more lax and down payments could be as low as 3.5%.
- VA loans. Another government-backed option is a VA loan — available to qualifying veterans, active-duty service members and their spouses. You can potentially get a mortgage with a $0 down payment, but only for your primary residence.
Other loans offered by Mr. Cooper
You can find a few other options with Mr. Cooper, including:
- Conventional refinancing. Lower your monthly mortgage payments and reduce your interest over the life of your loan by refinancing.
- FHA Streamline refinancing. Get your FHA loan refinanced and potentially lower your monthly payments.
- VA Interest Rate Reduction Refinance Loan (IRRRL). A refinancing option for existing VA loans that doesn’t require credit underwriting. But you’ll pay a funding fee.
Mr. Cooper fees
Loans can carry different fees based on what type you’re applying for, but there are some general fees you can expect to pay across the board.
- Points. You’ll see certain fees calculated as points, including the origination fee. One point is equal to 1% of the loan amount, so an origination fee of 2 points on a $300,000 loan would be $2,000.
- Application. Outside of the origination fee, you could pay an application fee to cover document processing and an underwriting fee for evaluating your application and making a determination on it.
- Third-party. An appraisal may be done by a third party and require you to pay a fee. Title services may also get pushed to you, which include looking up the title and getting title insurance.
- Ongoing. Insurance and taxes are the two biggest ongoing costs, and you may be required to open up an escrow account to stay on top of them.
Mr. Cooper’s Close On Time Guarantee
If you’re applying for a conventional mortgage, you have the chance to qualify for the Close On Time Guarantee. This program guarantees your loan will close on time, or Mr. Cooper will pay the principal plus interest on your first month’s mortgage payment.
Buyer’s Bonus Credit
You could receive a rebate on your agent’s fee of 15% when you use a real estate agent in the Xome Agent Network through Mr. Cooper.
Requirements
Qualifying for a loan with Mr. Cooper depends on a number of factors, including your creditworthiness, the type of loan you’re applying for and the loan amount. While it doesn’t provide specific outlines for these requirements, you can apply for prequalification before submitting a full mortgage application.
Documentation
While there isn’t an official list of documents you’ll need to submit, you can count on needing some or all of the following:
- Pay stubs for the past two months
- W-2s for the past two years
- Tax returns for the past two years
- Balance statements on bank and investment accounts for at least the past month
- Statements of existing debt
- Mortgage or rental payment history for the past year
- A written statement explaining any credit report discrepancies
- Verification of child support or alimony
- Divorce decree
- Proof of additional assets or down payment gifts
How to get a home loan with Mr. Cooper
The application process with Mr. Cooper is completed online and over the phone.
- Go to the Mr. Cooper website.
- Click Buy or sell a home.
- Select Prequalify now.
- Choose the option that best fits your situation and click Get prequalified, Get started or Apply now.
- Fill in your name, personal information, contact information, whether you’ve been in the military and if you’ll have a coborrower. Then select Next.
- Once you submit all of the requested information, including the loan amount and the location you’re looking to buy in, you’ll talk with a Mr. Cooper representative on the phone and discuss financing options.
- If you’re preapproved, you can move forward in the process and submit any documentation online.
- Underwriting is the next step, where all of the documentation is reviewed and a decision is made on your application.
- Upon approval, your Mr. Cooper loan officer will call to schedule a closing date and time.
Mr. Cooper reviews and complaints
Out of the 34 mortgage servicers rated by J.D. Power in 2019, Mr. Cooper came in toward the bottom at 28 for customer satisfaction. It ranked last in the “About average” grouping, earning only 738 out of 1,000 points.
The Better Business Bureau (BBB) profile for Mr. Cooper doesn’t paint a better picture for the company. It’s not accredited and holds an A+ ranking from the BBB. The average customer review as of November 2020 puts it under 1.14 out of 5 stars.
Pros and cons of Mr. Cooper
Pros
- Widely licensed. Mr. Cooper is licensed in all 50 states, Washington DC, Guam, Puerto Rico and the US Virgin Islands.
- Close On Time Guarantee. Get your first mortgage payment covered by Mr. Cooper if your qualifying mortgage doesn’t close on time.
- App available. Android and iPhone users can download the mobile app to make payments, get property tax history, look up home value and equity information and more.
Cons
- Overwhelmingly negative reviews. Between its BBB profile and J.D. Power ranking, customer experiences with Mr. Cooper are lacking on the whole.
- Limited selection of loans. You won’t find a whole lot beyond the basic selection of mortgage options.
- Hard to get information. In doing research for this article, it was difficult to contact Mr. Cooper by phone. One phone number on the site was out of service, and once we got through, we were routed to the wrong department.
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What is Mr. Cooper?
Mr. Cooper, formerly Nationstar Mortgage, is a mortgage provider based in Dallas, Texas. Several settlements and government actions against Mr. Cooper resolved in 2018, including suits by the California Department of Business Oversight and New York Department of Financial Services — as well as a fine by the state of Massachusetts.
In December 2020, Mr. Cooper agreed to pay a $91 million settlement for allegedly violating consumer protection laws between 2012 and 2015. Allegations filed by the Consumer Financial Protection Bureau include complaints that the lender improperly increased borrowers’ payments and mishandled loan modifications for homeowners who were struggling to make on-time payments. Representatives from Mr. Cooper acknowledged the issues and claimed that management took steps to address the problems during the investigation.
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Review by
Rhys Subitch
rhys.subitch@finder.comRhys Subitch is a writer and editor at Finder who tackles topics across the site. With half a decade of experience researching, editing and writing for a Fortune 500 company, university and several independent publications, Rhys brings readers the most up-to-date and curated info on all things finance.
Expert review
According to third-party sources and customer reviews, you’re not likely to have the best experience with Mr. Cooper. If you’re looking for a provider with a better reputation or a bigger loan selection, check out our mortgage guide and compare your options — you might find a great fit.