US Bank Mortgage Review: Diverse Choices at Standard Rates

US Bank Mortgage Review: Diverse Choices at Standard Rates

US Bank won’t necessarily deliver the best deal on your mortgage interest rate or closing costs, but it can help you explore the many different options there are for purchasing a home or refinancing your loan. US Bank serves many parts of the US that don’t have a wealth of options when it comes to large-scale mortgage lenders, making it a logical place to begin your search for brick-and-mortar home loan services.

US Bank: Diverse Choices at Standard Rates

US Bank’s mortgage products come in many different forms, making it a good place to shop for a home loan if you haven’t settled on exactly what you’ll need. For both purchasing and refinancing, the bank has fixed rate and adjustable rate options that cover the most popular mortgage types and terms. US Bank also participates in the FHA and VA loan programs, which allow qualified borrowers to obtain home loans with down payments of 3.5% or even less.

In addition, US Bank does business in many Western and Midwestern states that aren’t covered as heavily by major banks that consumers in other areas take for granted. This makes US Bank an important option in states such as Idaho or North Dakota, where there may not be as many mortgage lenders to choose from. The wide range of US Bank home loan products makes it a convenient place to start learning about the kinds of financing you have available, even if you end up finding a better rate elsewhere.

How Do US Bank Mortgages Compare?

Since US Bank’s mortgage website doesn’t allow for custom estimates like other major banks, we obtained comparable mortgage rate estimates from those banks by plugging in US Bank’s own assumptions of a $150,000 loan and 20% in down payment.

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30-Year Fixed Rate Mortgage Estimates at Major Banks

US Bank Chase Bank of America Wells Fargo
Interest Rate 3.88% 4.00% 3.88% 4.25%
APR 3.95% 4.11% 4.04% 4.36%
Monthly Payment $565 $692 $564 $590

While US Bank offers one of the lower mortgage rates when you compare among the largest banks, its generous assumptions about loan amount and down payment make its estimate overly optimistic. When we used the same assumptions with online estimates from other lenders, Bank of America’s estimate turned out to be very close to US Bank’s advertised rate and mortgage APR. There was also no clear sign of whether US Bank’s monthly payment estimate included the added cost of taxes and homeowner’s insurance.

In addition, US Bank was the only lender to omit an estimate of closing costs, making it even more difficult to determine whether its low interest rate really offers better value to a typical borrower. All borrowers have the ability to lower their mortgage rates by paying for discount points upfront. Conversely, you can also agree to take a higher interest rate on your home loan in exchange for lowering your closing costs. This ability to adjust between mortgage rate and closing fees means that without a detailed rundown of US Bank’s closing costs, it’s hard to tell whether the interest rate is truly competitive.

Customer Service and Mortgage Servicing

US Bank customers report an above-average level of satisfaction with the quality of the bank’s mortgage loan servicing, based on complaints data and JD Power customer ratings. It’s worth noting that US Bank currently has one of the lowest rates of CFPB complaints, although this may be due to the fact that its customers are located in a different region than most competing banks.

Mortgage-Related Complaints at Major Banks, 2013-2017

Company Mortgage Originations CFPB Complaints Ratio 2017 JD Power Rating
US Bank 642,956 4,667 0.73% 770
Chase 948,000 14,778 1.56% 764
Wells Fargo 2,155,222 25,182 1.17% 745
Bank of America 1,172,113 28,187 2.40% 767

In the time since the Consumer Financial Protection Bureau began logging complaint data, all three of US Bank’s larger competitors have seen a higher rate of mortgage-related complaints. However, it’s hard to point to US Bank’s numbers as a clear sign of superior mortgage servicing. This is because US Bank serves a significantly different geographic area, which introduces potential differences in consumer behavior. To determine the real cause of US Bank’s lower rate of mortgage complaints, we had to compare the data on a state-by-state basis.

The comparison revealed that the rate of mortgage complaints varied by state as much as it did by company. And since US Bank’s market tends to cover states that had lower rates of complaints, its apparent advantage in this area may be the cause of geographic contrasts rather than superior quality of service. Still, JD Power’s survey of customer satisfaction awarded US Bank with a higher score for its mortgage payment servicing than either Chase or Wells Fargo.

Mortgage Loan Products at US Bank

Compared to most major lenders, US Bank carries a large variety of mortgage options. These include FHA mortgages for people seeking a lower down payment and adjustable rate (ARM home loans) for borrowers planning on refinancing their mortgages.

Mortgage Product Interest Rate APR
30-year fixed conventional 3.88% 3.95%
30-year fixed FHA 3.63% 4.68%
15-year fixed conventional 3.25% 3.37%
15-year fixed FHA 3.63% 4.70%
10-year ARM 3.50% 3.71%
5-year ARM 3.13% 3.76%

These mortgage rates reflect estimates for a home price of $150,000 with a down payment of 20%. Using these numbers produced similar interest rate calculations at other lenders, making US Bank a fairly standard option when it comes to rate-shopping. Still, US Bank may be a good place to start looking for a mortgage if you haven’t zeroed in on the type of loan that will fit your needs. With plenty of different mortgage types, it’s unlikely that the bank won’t have a solution that makes sense for you —even if its interest rate is about the same as at most other lenders.

The diversity of US Bank’s mortgage products extends into construction and investment loans. Most people shopping for a mortgage are interested in either buying a home to live in or refinancing a loan on their current residence. However, US Bank also provides mortgages to cover people who plan on constructing their own house or purchasing as an investment. The bank also markets jumbo loans, which are necessary for people whose homes cost more than the conforming loan limit.

Where Can You Get a Mortgage With US Bank?

As we mentioned in our discussion of CFPB complaints, US Bank branches are concentrated in many areas that aren’t as heavily covered by its biggest competitors. These areas include many Midwestern and Western states.

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