Intro: Capital One Mortgage Reviews
Touted as one of the top 10 largest bank holding companies in the United States, Capital One promises to provide a better home loan experience while maximizing savings.
But does Capital One live up to that promise?
We took a closer look at Capital One mortgage reviews and their home loan process to find out.
Capital One offers an extensive selection of financial products and services, including home loans, credit cards, and banking. Capital One has over 900 bank branches, including their Capital One 360 brand. While digging through hundreds of online reviews, we found that Capital One 360 mortgage reviews were on par with Capital One home loans reviews.
Image Source: Capital One Mortgage Reviews
Capital One can help you get a mortgage for owner-occupied properties, vacation homes, and rental properties. However, if you are in the market for a mobile home, timeshare, or leasehold, you will need to look elsewhere as Capital One does not accommodate these types of estates.
While Capital One uses various factors to determine how much money you qualify to borrow, some key aspects include your credit history, the loan you are interested in, and the type of property you are looking to purchase. To calculate a monthly mortgage payment that you can afford, Capital One will also use your debt-to-income ratio, which is the percentage of your monthly gross income that goes toward paying debt.
Capital One prides itself on its ability to save you money with competitive rates and closing costs. This claim is backed by several Capital One mortgage reviews on Credit Karma from customers who were satisfied with their savings.
Capital One Mortgage Rates
For people looking for a fixed-rate mortgage with no surprises, Capital One’s 15-year fixed-rate mortgage will give you a fixed-rate and payment for the duration of the loan. If you are planning to stay in your home for an extended period of time but are seeking a lower monthly principal, the 30-year fixed-rate mortgage might be the best choice for you.
The 5/1 adjustable-rate mortgage aligns well with people who are planning to move or refinance every five to seven years. This rate is fixed for the first five years and then will continue to adjust in accordance with the conditions of the loan.
Similarly, Capital One’s 7/1 adjustable-rate mortgage is for the short-term homeowner with a fixed rate for the first seven years. With these options, you will get a lower rate since you are locked into a fixed rate for a shorter time.
How Does It Work?
1. Check Your Eligibility
You will first need to complete Capital One’s quick and painless pre-qualification process to find out if you are eligible for a home loan. The process takes only minutes and is completely free.
To check your eligibility, you can either submit a short form online or provide your loan information by phone. Capital One will then run a quick credit review and send you a pre-qualification letter, which equips you with written confirmation of your credit standing, home buying power, and the estimated amount you are eligible to borrow.
We came across two dissatisfied erson Credit Karma who were both initially approved and then denied a loan one to three months later. One reviewers blamed Capital One’s credit reporting agency, Credco, for this major blunder.
This step is easy enough to complete, and with the pre-qualification letter in hand, you can shop for a new home with confidence. Not only will sellers know that you can afford the property, but you will also save time by narrowing your house hunting efforts to properties that are within your price range.
2. Find Your Home
It is important to understand your budget before you begin shopping for a new house. As one Capital One home loans review on Credit Karma advises, do your homework ahead of time.
To help you shop more efficiently, Capital One offers a handy affordability calculator that will determine your budget after you input your target home price, down payment, credit score, and new zip code. You also have the option of contacting a Capital One mortgage lender for a detailed evaluation of your budget.
3. Apply and Submit Documents
You can apply for a mortgage once the seller accepts your offer and you have a signed contract. According to Capital One, the document submission stage is the most arduous part of the home buying process and usually takes 30 days to complete. Some of the documents you will need to submit include your tax returns, pay stubs, and savings statements.
While Capital One lists an average timeline of 30 days on their website, there were several Capital One mortgage complaints on Credit Karma that criticized the company for their longer-than-expected wait time. Keep this in mind when you begin the process, and you might want to prepare your paperwork ahead of time to avoid a delay in getting your loan.
Other mortgage companies might ask you to email, fax, or physically visit your loan officer with your documents, but Capital One boasts a simplified documentation process using LoanHub, a platform that allows you to upload, sign, and review documents online.
While these technological advances seem enticing, some customers have pointed out some serious bugs they experienced with the software. One frustrated Capital One home loans reviewer on LendingTree complained that LoanHub would not allow him to upload any documents. The customer service representative was unable to assist him because he was not familiar with the new Capital One Home Loans website.
Technology is supposed to make our lives easier, but it can’t unless it works properly. Capital One may need to focus on improving their user experience to make this stage of the process as seamless as possible.
4. Close on Your Home
You will need to sign documents verifying that you accept the mortgage on your closing date. According to a Capital One 360 mortgage review on thetruthaboutmortgage.com, the closing costs seem to be lower in comparison to other mortgage companies, which he believes is because Capital One waives loan origination fees while keeping other charges to a minimum.
Once signed, your lender will transfer the money for your new home to the seller, who will then sign a deed giving you ownership. After that’s completed–congratulations! The house is yours.
Who Is Eligible for a Capital One Mortgage?
Image Source: Capital One Home Loan Application
Capital One considers several factors when evaluating your home loan application, including credit score, debt-t0-income ratio, maximum available down payment, and job stability.
1. Credit Score
The higher your credit score, the easier it is to get approved for a home loan. A high credit score can often lead to lower interest rates as well. Your credit score is a culmination of multiple factors, such as whether you make your payments on time, how long you have had other credit or loans, what your current credit allotment is, how many recent credit checks you’ve had, and how often you open new credit or loan accounts. Capital One typically considers anything over 660 as favorable.
2. Debt-to-Income Ratio
Your debt-to-income (DTI) ratio is how much of your pre-tax monthly income goes towards paying off debt. This includes taxes, credit card payments, car loan payments, student loan payments, child support, and alimony. Ideally, Capital One would like your DTI to be lower than 50%, but this number depends on your individual circumstances.
3. Down Payment
The down payment is the money you pay up-front on the cost of your home. A good rule of thumb is to make a down payment of about 20% of the purchase price of your home. A sizable down payment tells Capital One that your loan may be less risky, which could lead to a lower interest rate.
4. Job Stability
Like the credit check, the job history and stability check verifies how likely you are to repay the loan. Capital One wants to see a pattern of income stability. For example, if you have been at your current job for two years or more, you will have an easier time getting a loan. Capital One Mortgage reviews all of your employment factors as part of the loan approval process.
Capital One Mortgage Reviews
We found a wide spectrum of Capital One mortgage reviews that ranged from fully satisfied customers to fed up customers full of regret. We thought it would be helpful to provide a quick overview of customer feedback to give you a heads up on what to expect if you decide to go with Capital One for your home loan.
Let’s start with LendingTree Capital One home loans reviews. From 2692 reviews, LendingTree customers gave Capital One an average of 4.4 out of 5 stars, with customer service and responsiveness being the top traits. When you break it down, 60% of LendingTree customers gave Capital One five stars, while only 2% gave them one star.
Customers were pleased with the experienced and knowledgeable staff, with one reviewer saying that her representative did everything possible to meet her loan needs. Interest rates, fees, and closing costs were marked as satisfactory. The mortgage calculator was also noted as making it easy to figure out specific details about a home loan.
Capital One mortgage reviews from Credit Karma had a different story to tell. While there were only 12 reviews, 58% of those reviews were one star. Only 34% of reviews were 4 stars and above. Some customers referred to their experience as “a nightmare” and accused the sales representatives of being misleading.
Reviews from other companies, such as Consumer Affairs and BestCompany.com, show a similar, negative narrative of high volume of complaints, misleading sales scenarios, and above-average interest rates. Reviewers also remarked on the limited loan options (fixed rate mortgages or adjustable rate mortgages), and how Capital One only services eight states.
The Bottom Line
Since competitive mortgage rates are on the rise, it is important that you do your research to ensure you are securing the best possible deal. You will find a mixed bag of Capital One home loans reviews online. Customers and rating agencies highlighted the areas where Capital One excels, while a slew of reviewers complained about inefficiencies that require major improvement.
While the company has an A+ rating with the Better Business Bureau and does a great job at providing information about their loan products, the high volume of Capital One mortgage complaints and above-average interest are factors that all potential borrowers should be aware of. Do your homework so that no matter which company you choose, you feel confident in your next steps toward homeownership.
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