USAA Bank mortgage review
VA loans for current and former military members and their families.
finder.com’s rating: 3.5 / 5.0
USAA serves veterans, military members and their families with VA loans, VA jumbo loans and VA refinance loans. With nationwide availability and no origination fee, USAA can be a good option for eligible customers. But customer reviews have fallen in the last few years.
The number one requirement to qualify for a mortgage with USAA is membership in the organization. To join USAA, you must be:
- Actively serving in the US Air Force, Army, Coast Guard, Marines, Navy, National Guard or Reserves.
- Former military who has retired or separated from the US military with an honorable discharge.
- Family, including widows, widowers and un-remarried former spouses of USAA members who had USAA auto or property insurance while married and individuals whose parents have or had USAA auto or property insurance.
- Cadets or midshipmen at US service academies, in advanced ROTC or on ROTC scholarship, plus officer candidates within 24 months of commissioning.
Financial factors that USAA considers when determining if you qualify for a loan include your income and your debt-to-income ratio (DTI). Mortgages with USAA also have a $50,000 minimum loan amount.
When you apply for a mortgage with USAA, be prepared to supply:
- Bank statements.
- Tax returns.
- Income statements, such as pay stubs or award letters.
- Other supporting documents as requested.
Costs and fees
USAA doesn’t charge origination, underwriting, documentation or application fees. It also doesn’t charge prepayment penalties, meaning that you can pay off your loan early without any fines or fees.
Although USAA doesn’t charge any of these fees, most borrowers using a VA loan are required to pay a one-time VA funding fee. The amount of the funding fee depends on your loan amount and other factors but is typically between 1.4% to 3.60%. Specific eligible veterans can have the VA funding fee waived entirely.
How to apply for a mortgage with USAA
To apply for a mortgage with USAA, follow these steps.
- Get preapproved in minutes. Tell USAA about your finances and where you want to move. They’ll check your credit to reduce the chance of getting denied later, and you’ll get a shopping letter that might help with seller negotiations.
- Apply for your mortgage. Once you find a home, your loan officer will help you complete a mortgage application. You’ll need income statements, current bank statements and other supporting documents.
- Wait for approval. USAA takes two to three weeks to confirm required documents and a clear title for your home, sending status updates of your application’s progress.
- Get the keys to your new home. When your paperwork is approved, you’re ready to close. Bring along your government-issued ID and a cashier’s check for your closing costs and down payment.
What types of mortgages can I get through USAA?
Other mortgage products available at USAA
USAA doesn’t offer any other mortgage products at this time. However, a USAA representative confirmed the company plans to once again offer conventional loans sometime in the near future.
How USAA’s mortgage products compare to other lenders
At this time, USAA only offers VA, VA jumbo and VA refinance mortgages. The company had previously offered conventional loans and specific vacation or investment mortgages as well, but these programs are paused right now. Compared to other mortgage lenders, USAA’s mortgage products lag behind.
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USAA reviews and complaints
As of August 2021, USAA is not accredited by the Better Business Bureau (BBB), where it earns an A rating. And with more than 140 reviews left on the site, it earns 1.12 out of 5 stars. Customers largely complained of slow customer response times, poor communication and transparency and issues when filing claims regarding insurance policies.
On Trustpilot, customers rated USAA 1.3 out of 5 stars with 997 reviews. Some customers praised its excellent customer service and low fees. However, most customer reviews reported otherwise. A majority of dissatisfied customers describe a poor customer service experience, slow processes and issues with insurance claims. These reviews are for USAA as a whole and not necessarily its mortgage products.
For unfiltered feedback, check out USAA’s Member Community online. USAA responds to most inquiries on the forum, even forwarding negative reviews to more senior departments to sort out any issues.
USAA pros and cons
Consider this lender’s strengths and weaknesses to decide if it’s right for you.
- No origination fee. Unlike many mortgage lenders, USAA doesn’t charge customers any sort of loan origination fee.
- Specialized help for military members. USAA offers VA loans, insurance, investments and bank accounts to qualifying military members, veterans and family.
- Simplified mortgage process. A streamlined process makes homebuying less stressful.
- Members only. Mortgages with USAA are only available to former and current members of the military and their families.
- Poor customer ratings. Though not every customer has had a negative experience doing business with USAA, reviews show customers are largely dissatisfied with the company.
What is USAA?
Founded in 1922 in San Antonio, Texas, USAA offers loans and mortgages, banking products, investments and insurance to more than 13 million former and current military members and their families.
In 2020, USAA originated the second-highest total of VA-purchase home loans, according to the Department of Veterans Affairs.
Peter Carleton is a writer that covers banking and investing, breaking down what you need to know about where you put your money. When Peter's not thinking about cutting-edge banking apps and robo-advisors, he runs a creative agency and spends his spare time cooking or reading.
USAA mortgages are a good option for military members, veterans and their families who are interested in a VA-backed mortgage. USAA steers away from many of the common fees associated with buying a home, but the company seems to be struggling to please its customer base.
That being said, there’s no harm in calling and speaking with a USAA mortgage specialist as you shop around and compare mortgage lenders – you might have a different experience than other customers. For what it’s worth, I’ve been a USAA member for 14 years and have never had a poor experience with USAA customer service.