PennyMac Loan Services, LLC was founded in 2008 with the stated goal of restoring America’s trust in homeownership through high-quality and consistent mortgage services.
The company is headquartered in California, but its home loan products are available to borrowers in all 50 states. PennyMac has quickly become one of the top mortgage lenders in the U.S. by offering a diverse range of mortgage products, including conventional and government-backed loans.
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PennyMac Mortgage Facts
- Named #1 lender for USDA loans by U.S. News & World Report in 2018
- Accepts credit scores as low as 640
- Offers a wide variety of mortgage products, including fixed and adjustable-rate, FHA, VA, USDA, and jumbo loans
- Low down payment requirements for conventional and government-backed loans
- Fully accredited by the Better Business Bureau
- Private mortgage insurance required for down payments lower than 20 percent
Overview
PennyMac has only been in operation for 11 years, but in that short time, it has distinguished itself as one of the largest direct mortgage lenders in the country. PennyMac’s massive catalog of conventional and government-backed loans has helped it appeal to borrowers of all types, especially those looking to make low down payments.
Most of this lender’s home loan offerings can be obtained with as little as 3 percent down, though higher down payments can help lower interest rates and monthly payments. Moderate-to-low income borrowers can benefit from PennyMac’s flexible qualification guidelines, as it regularly accepts applications with credit scores as low as 620.
Although the Better Business Bureau fully accredits PennyMac, it has had over 300 customer complaints filed against it over the past ten years; its profile currently features a 1-star customer rating with many of the complaints mentioning poor customer service and payment processing errors. Most of PennyMac’s customers use their online account services to manage their home loans, which may account for the reduced response times to customer inquiries.
Current PennyMac Mortgage Rates
PennyMac Loan Specifics
PennyMac is a publicly-traded, national mortgage lender dedicated to providing personalized lending options for home buyers anywhere in the U.S., including conventional fixed and adjustable-rate, FHA, VA, USDA, and jumbo loans. This lender works with first-time homebuyers and repeat borrowers to secure affordable interest rates and flexible term options, though each mortgage offering has its specific qualifications. Many of PennyMac’s home loan products feature low down payments, making it an excellent choice for low-to-moderate-income borrowers.
Fixed-Rate Loans
This conventional loan option allows borrowers to lock down an affordable interest rate for the full loan term, offering exceptional long-term stability and predictable monthly payments. Qualified borrowers can secure a PennyMac fixed-rate mortgage with a down payment as low as 3 percent and can select from a loan term of 15, 20, or 30 years.
While private mortgage insurance is required for down payments below 20 percent, homebuyers can have it removed after reaching an 80 percent loan-to-value ratio. This mortgage type can be used to finance primary residences, second homes, and rental properties, making it a solid choice for borrowers who are looking to invest in their property over a long period.
Adjustable-Rate Loans
Homebuyers looking for the lowest short-term rates may benefit from this conventional loan option, which can keep monthly payments low for an initial fixed-rate period. Borrowers can secure a stable rate for the first 3 to 10 years of the loan term, after which the interest rate and monthly payment amount will annually adjust to the market index.
Cash-Out Refinance Loans
This loan program allows borrowers to access the equity in their property to pay for home improvement projects, settle lingering debts, or cover other expenses they have accrued. PennyMac offers both fixed and adjustable-rate refinancing options with a variety of loan terms, allowing borrowers to consolidate their debts without being buried by high interest rates. This refinancing option might be a good fit for responsible homeowners who have kept up with their mortgage payments and want to manage their debt through the equity they’ve built up.
Jumbo Loans
For more expensive properties, PennyMac offers both fixed- and adjustable-rate jumbo loans for amounts of up to $2 million. This loan option was designed to help support property purchases that exceed the conforming loan limits set by Fannie Mae and Freddie Mac. To qualify, borrowers must have a credit score of 700+ and be able to make a down payment of at least 20 percent. Jumbo loans are great for luxury home purchases and can accommodate multiple types of properties, including 2-unit and vacation homes.
FHA Loans
This loan type was created to help low-to-moderate income borrowers and first-time homeowners secure affordable mortgage rates and is insured by the Federal Housing Administration. Unlike other home loan programs, an FHA mortgage has flexible credit score requirements and can be obtained with scores as low as 580. Typically, borrowers with higher credit scores are offered better rates, which translates to lower monthly payments. This mortgage option is well suited for homebuyers who are unable to make large down payments, as PennyMac accepts as little as 3.5 percent down to get started.
VA Loans
Eligible veterans and service members can take advantage of this no-money-down mortgage option backed by The Department of Veterans Affairs. Qualified borrowers can choose from several fixed-rate loan terms, including 15, 20, or 30 years. One major benefit of this home loan program is that it does not require private mortgage insurance, even on purchases with no down payments.
USDA Loans
PennyMac provides this 100 percent financing option to borrowers interested in purchasing a home in certain rural and suburban areas. This home loan program is insured by The United States Department of Agriculture and was created to help moderate-to-low-income borrowers secure affordable mortgages in less-developed regions of the country. Eligible homebuyers can qualify for this program with no money down, though a credit score of 640 is required.
Investment Property Loans
Homebuyers looking to invest in single-family homes, condos, apartment complexes, and townhomes may benefit from this loan program, as it is tailored to the needs of borrowers who plan to remodel or flip properties for a profit. Down payment minimums are based on the specific property type, with vacation homes needing 10 percent down and condos requiring 15 percent. This loan program covers all types of properties, though certain debt-to-income guidelines may apply.
PennyMac Mortgage Customer Experience
As a direct mortgage lender, PennyMac is committed to helping all types of homebuyers tackle the unique challenges of purchasing a home and securing affordable interest rates. All of PennyMac’s resources are devoted to supporting the mortgage application and management process, as it does not maintain a large network of branches or banking products. Borrowers living in any of the 50 U.S. states can work with this lender to purchase, refinance, remodel, or invest in their property of choice, though some restrictions may apply.
PennyMac features a massive catalog of educational resources on its website, including articles, FAQ pages, buying guides for first-time homeowners, and mortgage calculators. Interested borrowers can obtain personalized rate quotes, apply for pre-approval, or fill out a mortgage application entirely online, though, personal information like social security numbers are required.
PennyMac Lender Reputation
While PennyMac has only been in business for 11 years, it has quickly earned the distinction of being one of the nation’s largest online mortgage lenders. Pennymac currently has an A+ rating with the Better Business Bureau and has been fully accredited since 2014. Despite its accreditation, PennyMac’s BBB profile features a 1-star customer rating with over 385 customer complaints. According to a 2023 complaint report from the Consumer Financial Protection Bureau, there were 111 complaints filed against this lender for the past 3 months.
PennyMac Mortgage Qualifications
| Loan Type | Rate Type | Loan Terms | Down Payment Requirements | Credit Score Requirements |
|---|---|---|---|---|
| Fixed-Rate Loans | Fixed | 15, 20, or 30 years | 3% | 620 |
| Adjustable-Rate Loans | Variable | 3 – 10 years | 3% | 620 |
| Jumbo Loans | Fixed or Variable | 30 year fixed or 5/1 ARM and 7/1 ARM | 20% | 700 |
| FHA Loans | Fixed or Variable | 15 and 30-year fixed or 5/1 ARM | 3.5% | 580 |
| VA Loans | Fixed | 15, 20, or 30 years | 0% | 620 |
| USDA Loans | Fixed | 15 or 30 years | 0% | 640 |
While most of PennyMac’s mortgage products have different qualification guidelines, most feature low down payments and flexible credit score requirements. Conventional mortgages usually require down payments of at least 5 percent, but PennyMac accepts as little as 3 percent down for both fixed and adjustable-rate loans.
Additionally, most lending institutions ask for credit scores above 680, but PennyMac is willing to work with borrowers whose scores are as low as 620. Homebuyers with little or no credit histories are encouraged to apply and may qualify for one of the many government-backed programs offered by this lender, though it is unclear whether PennyMac considers non-traditional credit information.
PennyMac’s biggest advantage is that it supplies a staggeringly diverse range of home loan and refinance options. Low-to-moderate income borrowers have a variety of available choices, and first-time homebuyers can secure affordable mortgage rates without emptying their bank accounts on a large down payment.
Although private mortgage insurance is required for down payments below 20 percent, PennyMac will work with homeowners to remove the charge once they’ve accumulated enough equity. Since this lender does the majority of its business online, homebuyers have around-the-clock access to their loan accounts and can reach out to a lending agent by email, phone, or through PennyMac’s contact page.
PennyMac Phone Number & Additional Details
- Homepage URL: https://www.pennymacusa.com/
- Company Phone:1-888-870-6229
- Headquarters Address:3043 Townsgate Rd, Suite 200, Westlake Village, CA 91361
Conclusion
PennyMac stands as a versatile mortgage lender, dedicated to catering to a wide spectrum of homebuyers across the U.S., from first-timers to seasoned investors. With a comprehensive suite of loan options ranging from conventional fixed and adjustable rates to specialized loans like FHA, VA, and jumbo loans, they offer a solution for virtually every financial situation and property type. Their commitment to easing the buying process is evident through their expansive online resources, streamlined digital application system, and dedication to educating potential borrowers.
Although they’ve quickly ascended as one of the nation’s top online mortgage lenders, it’s essential for prospective clients to do their due diligence, given the notable number of customer complaints. Their array of loan products and terms coupled with stringent requirements make them an essential player in the mortgage landscape, yet it emphasizes the importance of understanding individual financial needs and researching before finalizing a decision.
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Product Name: PennyMac Product Description: PennyMac is a nationally recognized, publicly-traded mortgage lender offering diverse mortgage solutions to homebuyers across the U.S. They provide a range of products from conventional fixed and adjustable-rate mortgages to specialized options like FHA, VA, and jumbo loans. Their services are tailored for both first-time homebuyers and repeat borrowers. Summary of PennyMac Established as a prominent mortgage lender, PennyMac caters to a wide spectrum of homebuyers with its comprehensive suite of loan offerings. The company’s portfolio includes traditional fixed-rate mortgages, which ensure long-term stability, and adjustable-rate mortgages which provide flexibility with initial lower rates. They also specialize in loans such as FHA for those with lower credit scores or limited down payments, VA loans for veterans and service members, and jumbo loans for luxury properties. Committed to assisting homebuyers through every step, PennyMac couples its diverse mortgage products with educational resources and a digital-friendly application process. Pros Cons
PennyMac Review
Overall
Stay away from PennyMac.I was in the hospital with covid. Almost died. So I was late with my house payment and Penny Mac was not understanding at all and would not remove negative remarks from my credit report. All of my other creditors helped me out by removing the negative reports on my credit record. I’m a 100% disabled veteran. And unable to get a ADA home, that does not have stairs, because of the remarks from Penny Mac. They are the only negative remarks on my credit record. My score is over 750. They are not understanding at all. Even with proof.