TD Bank Mortgage Review


| About TD Bank

TD Bank first opened its doors in 1852 under the name Portland Savings Bank in Portland, Maine. Since then, it’s gone through a series of expansions, most notably when it was purchased by TD Bank Group of Toronto, Canada, in 2007. By 2008, the company, which was then known as TD Banknorth, was rebranded as TD Bank.

The U.S. division of TD Bank is currently headquartered in Cherry Hill, New Jersey. As of October 2018, the company had closed approximately $2.3 billion in residential mortgages over the previous 12 months.


Working with TD Bank

TD bank is currently licensed in 15 states and Washington, D.C.:

  • Connecticut
  • Delaware
  • Florida
  • New Hampshire
  • New Jersey
  • New York
  • North Carolina
  • Maine
  • Maryland
  • Massachusetts
  • Pennsylvania
  • Rhode Island
  • South Carolina
  • Vermont
  • Virginia

As of January 2019, TD Bank operated approximately 1,240 retail stores and 2,641 ATMs.

Provided that you meet the minimum credit score requirement of 620, TD Bank issues loans for the following types of properties.

  • Single-family homes
  • Multi-family homes (up to four units)
  • Manufactured homes
  • Modular homes
  • Condominiums
  • Co-ops (in the northern New Jersey and New York City area)

TD Bank Products

Purchase

  • Conventional: The term conventional mortgage refers to any home that is not guaranteed or backed by a government agency, such as the Federal Housing Administration (FHA) or the U.S. Department of Veterans Affairs (VA).
  • Jumbo: So-called jumbo loans can refer to any loan that is larger than the limits set by Fannie Mae and Freddie Mac, the two government agencies that buy and sell the majority of home loans in the U.S.
  • VA: VA loans are guaranteed by the VA. They are available to eligible veterans, service members and their spouses. These loans offer no down payment options and flexible minimum credit scores.
  • FHA: FHA loans are guaranteed by the FHA. They are suitable for buyers with credit scores as low as 500 and come with down payments as low as 3.5%.
  • USDA: USDA loans are guaranteed by the U.S. Department of Agriculture (USDA). These loans do not require a down payment and have low, fixed interest rates.
  • HomeReady: HomeReady is a conventional mortgage program offered by Fannie Mae that’s aimed at borrowers who need a low down payment.
  • Construction: Construction loans are meant to help borrowers cover the cost of building their own homes. TD Bank offers construction loan options for both primary and vacation properties.
  • Investment: Not every bank offers loans for investment properties, but TD Bank does.

Refinance

  • Conventional: Refinancing your mortgage is simply the process of replacing your old mortgage with a new one, often to take advantage of a better interest rate or different loan term.
  • VA: Eligible veterans and their families can refinance their loan through the VA, provided they have an existing loan balance with TD Bank.
  • Cash-out: A cash-out refinance offers the opportunity to borrow more money than you owe on your home in order to pay for some of life’s big expenses, such as education or home renovations.
  • FHA cash-out: TD bank offers borrowers the opportunity to do a cash-out refinance through FHA. It does not, however, offer the FHA Streamline Refinance, which allows you to refinance an existing FHA mortgage with less-strict underwriting and credit requirements.
  • VA cash-out: Similarly, TD Bank offers the opportunity to do a cash-out refinance through the VA. At this time, however, it does not offer the VA’s Interest Rate Reduction Refinance Loan (IRRRL).

Home equity

  • HELOC: HELOCs, or home equity lines of credit, let you borrow against the equity in your home for a specified amount of time, almost like a credit card. After that initial draw period is over, you enter a repayment period, during which you repay what you borrowed.
  • Home equity loan: Home equity loans also let you borrow against the equity of your home. However, they function more like traditional mortgages with a lump-sum payout and regular, monthly payments.

TD Bank special mortgage programs

  • TD Right Step Mortgage: TD Bank offers a low-down-payment loan option that is similar to an FHA loan or Fannie Mae’s HomeReady program. It’s a 30-year, fixed-rate loan that allows for as little as a 3% down payment with no requirement for borrower-paid insurance. However, some homebuyer education is required.
  • TD Bank Construction Loan: Available in fixed- and adjustable-rate options, a construction loan with TD offers you the flexibility to be able to either build or renovate your home. It comes with the ease of a single closing process and the security of a rate lock that begins with construction.

The mortgage application process

How to apply. Interested consumers can apply for a loan with the help of a TD Bank loan officer over the phone or in person at one of TD Bank’s branches.
Disclosure process. The loan officer also takes the time to set would-be borrowers up with an online dashboard, where they can electronically sign disclosures and upload any documents needed for loan approval. Borrowers will also receive copies of their signed disclosures through the mail.
Submitting loan for approval. After all the necessary documents have been uploaded, the loan officer submits the loan for approval and connects the borrowers with a loan processor, who will help them receive final approval on their loan.
Final approval. Usually, the loan processor will first issue what’s known as a “conditional approval,” which means that a variety of contingencies — such as a clear title report or satisfactory appraisal — need to be met in order to receive final approval. Exactly what contingencies are needed can vary, according to the individual property. However, once they’ve all been received, the loan processor will issue the final approval.
Closing. Once final approval has been received, the borrowers can move forward to closing. They can choose the time and place of closing, but according to TD Bank’s policies, closing documents must be signed in person, rather than electronically.


Pros and cons of a TD Bank mortgage

Pros

  • Special programs. TD Bank has a few proprietary loan programs tailored to borrowers with specific needs, including those building a new home or renovating an existing home and those who need low down payment options.
  • Wide variety of products. TD Bank offers a wide variety of mortgage and home equity products, including fixed-rate and adjustable-rate options, construction loans, government loans and jumbo loans.
  • Good for people who want to work locally or online. Though TD Bank offers a variety of online tools for borrowers to use, it also offers the option to do the work at one of their locations.
  • Dedicated support during each step of the process. No matter where you are in the borrowing process, you always have a dedicated loan officer or loan processor on hand to answer questions.

Cons

  • Website lacks detailed information. TD Bank’s website does not have information about most of the specific loan programs that it offers.
  • Higher credit score requirements. While some loan programs will accept a score of 500, the lowest score TD Bank will accept is 620.
  • Only available in certain areas. As of right now, TD Bank only services the East Coast.

Editorial Note: Parts of this article were reviewed by a lender to ensure accuracy prior to publication. The overall conclusions, recommendations and opinions are the author’s alone.
The information in this article is accurate as of the date of publishing.