2020 PHH Mortgage Review • Pros & Cons • Benzinga

2020 PHH Mortgage Review • Pros & Cons • Benzinga

Who’s PHH Mortgage for?

New and experienced borrowers alike will benefit from working with PHH Mortgage’s experienced loan officers. You do need to live in one of the states PHH Mortgage serves, which are: Alaska, Arizona, California, Colorado, Delaware, Georgia, Illinois, Kansas, Massachusetts, Minnesota, Mississippi, Montana, New Hampshire, New Jersey, Ohio, Oregon and Rhode Island. PHH Mortgage offers most standard loan options, with the exception of USDA loans. 

PHH Mortgage Products

PHH Mortgage offers loans to help you buy a home as well as loans to help you refinance. Let’s take a closer look at what PHH has to offer.

Home Purchase Loans

PHH Mortgage offers several types of mortgages you can use to buy a home, including:

  • Conventional mortgages: These mortgages aren’t insured by a federal program. This means they may have higher requirements when it comes to your credit score. There are 2 types of conventional loans:
    • Conforming loans: These loans meet guidelines set by Freddie Mac and Fannie Mae. These companies insure conforming loans, making them less of a risk for lenders. Conforming loans have limits based on housing prices in a given area. In most areas, the loan limit is $484,350 for a single-family home. Some areas with higher home prices may have limits up to $726,525. 
    • Nonconforming loans: These loans don’t meet Freddie Mac and Fannie Mae’s guidelines. Often, these loans exceed the conforming loan limit. 
  • Jumbo loans: Jumbo loans are nonconforming conventional loans that exceed the conforming loan limit in your area.
  • Federal Housing Administration (FHA) loans: The FHA insures these loans to encourage more people to buy homes. These loans can have terms up to 30 years and offer down payments as low as 3.5%. To qualify for an FHA loan, you also need a debt-to-income (DTI) ratio of 43% or less. Your DTI compares your total debt payments to your monthly gross income. 
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Let’s say you have $1,500 in total debt payments each month, including your potential home loan, your credit card payments and your car payment. Your pretax income is $4,000. Your DTI ratio is 37.5%, which meets FHA guidelines. You may be able to qualify with a higher DTI ratio, but you’ll need to show compensating factors like a significant amount in savings. 

  • Department of Veterans Affairs (VA) loans: The VA insures these loans. Current service members, veterans and some surviving spouses can qualify based on their service record. These loans have no down payment requirement and no mortgage insurance. You need to have a DTI ratio of 41% or less unless you have compensating factors. Lenders will review your credit history and income to make sure you can afford the loan. 

PHH Mortgage notes that it offers these loans as fixed-rate or adjustable-rate mortgages (ARMs). Fixed-rate mortgages have the same interest rate and the same minimum monthly payment for the entire loan. PHH offers 15-, 20-, 25-, and 30-year fixed-rate mortgages.

Adjustable-rate mortgages have an interest rate that the lender can change. These loans start with a fixed interest rate period, and after that period the lender can adjust the rate. A 5/1 ARM has a 5-year, fixed-rate period. After that, the lender can adjust the rate once per year. PHH offers 3/1, 5/1, 7/1 and 10/1 ARMs. 

Refinance Loans

PHH Mortgage also offers loans for refinancing. Refinancing is when you replace your current mortgage with a new mortgage. People refinance for several reasons:

  • To lower their monthly payments
  • To lower their interest rates
  • To improve the terms of their mortgage
  • To take money out of their home

PHH Mortgage can work with people in all of these situations. If you’re interested in a refinance, let PHH know and they can help you determine whether it’s in your best interest and which loan would meet your needs. 

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Average Days to Close a Loan

Closing is the last step in the mortgage process. It’s when you sign all your paperwork and assume ownership of your new home. It can take a significant amount of time to close a loan. PHH Mortgage doesn’t have its average days to close publicly available. A look at the national averages can give you an idea of what to expect, though. 

The average time to close for all mortgages was 43 days as of February 2020, according to Ellie Mae. Loans to buy a home took 45 days, and loans to refinance a home took 40 days. VA loans took an average of 48 days, FHA loans took 46 days and conventional loans took 42 days. 

PHH Mortgage Credit Score Minimum

PHH doesn’t have its credit score minimum on its website. Your best option to find out PHH Mortgage’s requirements is to contact one of its loan consultants. That said, there are some typical minimums that can help you decide whether you’re ready to apply for a mortgage. 

In most cases, you will need a credit score of 620 or higher to qualify for a conventional mortgage. You will need a credit score of at least 580 to qualify for an FHA loan with a 3.5% down payment, and a credit score of 500 or higher to qualify with a 10% down payment. USDA loans don’t have a minimum credit score requirement, but lenders typically look for a score of about 640 or higher. VA loans also don’t have a minimum. Lenders look for a score of around 620 or higher, but they have to consider your overall credit history and financial situation. 

Preapproval Documents

You can apply for preapproval with PHH Mortgage by phone or on its website. Before you apply, you’ll need to gather some financial documents. You should find:

  • The full name, addresses and Social Security numbers for all applicants
  • Your tax returns for the past 2 years 
  • Your W-2s for the past 2 years
  • Your 2 most recent bank statements for all your bank and investment accounts
  • Your pay stubs from the past month
  • Your current employer’s contact information
  • Your current landlord’s or mortgage company’s contact information
  • The HUD-1 settlement statement for your current home (if applicable)
  • Documentation of the source of your down payment
    • If the funds are a gift, you need a letter from the person giving the gift, and they may need to provide documentation of the source of the funds
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Customer Service

Your main point of contact during the PHH Mortgage process is a loan consultant. You can reach a loan consultant at 800-210-8849 Monday through Friday from 9 a.m. to 9 p.m. EST. You can also reach loan officers from 10 a.m. to 2 p.m. EST on Saturdays. Once you have a mortgage in place, you can reach customer service by phone at 800-449-8767. You can also email at [email protected] 

PHH Mortgage also has a web portal you can use to manage your account, but it doesn’t have a mobile app. 

Is PHH Mortgage Right for Me?

Is PHH Mortgage the best mortgage for you? It could be, depending on the rates and terms you qualify for. Compare your offer from PHH Mortgage with other lenders. Review the terms, the fees and closing costs. PHH Mortgage has experienced loan officers to work with you and help you decide on the right mortgage for your needs.

Whether you’re purchasing your first home, a vacation home or an investment property or you’re refinancing, PHH Mortgage has options that could meet your needs.

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