USAA Mortgage Review

About USAA

USAA

In 1922, when 25 Army officers met in San Antonio, Texas, and decided to insure each other's vehicles, they could not have imagined that their tiny organization would one day serve over 8 million members and become one of the only fully integrated financial services companies in America. USAA provides a full range of highly competitive financial products and services to the military and their families. Our 22,000 world-class employees are personally committed to delivering excellent service and great advice. USAA is not a publicly traded company, so we don't answer to stockholders — we answer to our members. They rely on us to suggest products and services that meet their financial needs. When members join USAA, they join generations of military families who have depended on us to provide superior products and services in an atmosphere of financial strength. We maintain superior ratings from three of the major rating agencies. In fact, we're one of just two U.S. property and casualty companies with the highest ratings from A.M. Best, Moody's Investors Service and Standard & Poor's. Membership eligibility restrictions apply for USAA Bank mortgage products. Rates displayed are from USAA Bank and are limited to those eligible for property and casualty insurance and are subject to change. Non-USAA eligible consumers may be referred to or apply for a mortgage with Military Family Home Loans (MFHL), an operating subsidiary of Wells Fargo Bank, Member FDIC, and a jointly owned limited liability company of USAA Federal Savings Bank, Member FDIC, and Wells Fargo Ventures. MFHL rates and fees may differ from USAA Bank fees and rates. Equal Housing Lender.

review breakdown

Recommended
27%
Interest Rates
Fees & Closing Cost
Customer Service
Responsiveness

What they're saying about USAA

Read All Customer Reviews

What is USAA?

USAA — United Services Automobile Association — was founded in 1922 by a group of U.S. Army officers who wished to insure each other’s vehicles. Today, the Fortune 500 company is headquartered in San Antonio, Texas. In 2017, USAA generated more than $30 billion in revenue.

The company serves military members, veterans and their families. An early adopter of mobile deposit and other location-independent banking technology, USAA primarily serves its members remotely. There are only four physical financial centers available to customers: West Point, N.Y.; San Antonio, Texas; Colorado Springs, Colo.; and Annapolis, Md.

As a military-focused company, many of the mortgages originated by USAA are VA loans. In 2017, USAA originated $11 billion in VA home loans, making it the No. 3 ranking company for VA loan volume.


Working with USAA

USAA is licensed to do business in all 50 states.

USAA does not have locations with loan officers; all USAA mortgages are conducted remotely through the company’s website, phone, email and other electronic means.

Customers of USAA can apply for loans for the following types of properties:

  • Single-family homes, condominiums, townhomes, new construction, vacation homes, investment properties

USAA does not offer mortgage lending for manufactured homes.

While the VA does not require a minimum credit score for a VA loan and USAA does not cite a specific requirement in its materials, the company does say the minimum for most lenders is 620.

Your USAA loan officer will underwrite your mortgage application, according to the process outlined on USAA’s website.


USAA products

As one of the top three VA loan lenders by mortgage volume, much of the information on USAA’s website is geared toward those applying for VA loans. In order to apply for membership to USAA, you must be active or former military, an eligible family member (typically spouses and children of active military or veterans), a cadet or midshipman.

Purchase
USAA offers conventional home loans, VA loans and jumbo loans. Customers can choose from fixed-rate and adjustable-rate mortgages. Other loan options are also available for investment properties and vacation homes.

Refinance
Refinances are offered for conventional and VA loans. Conventional refinances are offered for up to 95% of the value of your home, while VA refinances can go up to 100%. USAA offers the VA Interest Rate Reduction Refinance Loan (IRRRL), which has no origination fee. USAA covers the appraisal, title and VA funding fee.

Customers can also choose conventional or VA cash out refinances. VA loans can be refinanced to 90% of the value of the home, while conventional refinances are allowed up to 80%.

USAA special mortgage programs
First-time homebuyer loans are offered to customers who haven’t owned a home in the past three years. This loan is for primary residences, and borrowers can put down as little as 3%. USAA pays for the private mortgage insurance (PMI), but the cost is passed on through higher interest rates.

USAA does not offer home equity loans or home equity lines of credit (HELOC).


The mortgage application process

With USAA, the mortgage application process is remotely based, either through the website, phone or a combination of the two.

The first step is generally preapproval. Customers can apply for preapproval online or over the phone, a process USAA estimates takes five minutes. With the issued preapproval letter, customers can shop for a home for up to 90 days before the preapproval expires.

Once you sign a purchase contract on a home, you can call to lock in your rate. Next, you’ll submit your application packet and required documents, such as pay stubs, bank statements and tax returns, for review. USAA estimates one to two weeks for this step. USAA will order an appraisal for the property and assign a mortgage processor.

For the next two to three weeks, USAA will review the appraisal, confirm your documents, request any additional materials and then provide you with a final decision.

The final step is closing. USAA will ask you to confirm the date and time, pay your closing costs and sign all required documents. USAA will coordinate with the title company.

Communication during the process

Customers can initiate the home loan process by applying for preapproval online or over the phone. Once you find a home and begin the loan process, you’ll work with an assigned loan officer to complete the mortgage application. Most required information is communicated through email and your USAA account. If you’re already a USAA customer, you’ll find messages in your inbox, when you access your USAA account, from your loan officer as you move forward in the application process. Communication via phone is another option for those wishing to speak directly with a loan officer.


Pros and cons of a USAA mortgage

Pros

  • VA loan expertise. The company is the No. 3 VA lender in the country. As a bank that only works with service members, veterans and their families, USAA is familiar with military financial needs.
  • Informative website. Customers can find information about VA loans, the application process, contact numbers, mortgage general information, interest rates and more.
  • Credit score. USAA accepts customers with credit scores as low as 620.
  • Alternate loans. USAA offers loans for customers buying vacation or investment properties.
  • Jumbo loans without PMI. Customers can get a jumbo loan without PMI through USAA.

Cons

  • No other government loans options. USAA does not offer USDA or FHA loans.
  • Lack of availability for civilians. USAA is only available to military service members, veterans and their families.
  • No home equity products. Home equity lines of credit (HELOC) and other equity offerings are not offered by USAA.

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.