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Costco Mortgage Review 2018

April 11, 2017
Finding the Right Mortgage, Mortgages
NerdWallet adheres to strict standards of editorial integrity to help you make decisions with confidence. Some of the products we feature are from partners. Here’s how we make money.
We adhere to strict standards of editorial integrity. Some of the products we feature are from our partners. Here’s how we make money.

When you think of shopping at Costco, what comes to mind? Bulk produce, perhaps, or mega-packs of diapers and enough rib-eyes to feed a small army. But mortgages? Not so much.

Believe it or not, though, you can shop for a mortgage (even jumbo ones) through the big-box wholesaler’s Mortgage Services for Costco Members — a lending marketplace available to Costco members and nonmembers alike.

While you can’t exactly shop for a home loan as you peruse camping gear or flat-screen TVs, you can go online to get rate quotes, contact participating lenders and apply for a purchase or refinance. Costco doesn’t actually sell you a mortgage itself; it connects you with a platform of lenders to choose from.

For Costco members, the major advantage of the program is that the loan origination fees are capped at $350 for Executive members and $650 for Gold Star and Business members. That could be a substantial savings considering that buyers typically pay 1% of the loan amount for loan origination fees.

Let’s take a closer look at Mortgage Services for Costco Members:

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  • Caps loan origination fees at $350 for Costco Executive members, and $650 for Gold Star and Business members
  • Offers conventional (fixed and adjustable-rate loans), FHA, VA, USDA, jumbo, HELOC and refinance loans
  • Licensed in all 50 states, Washington D.C., Puerto Rico and the U.S. Virgin Islands

How Costco mortgage compares to other lenders

Min. credit score

Contact lender for requirements

Min. down payment


Loan Types

Purchase, refinance, home equity, jumbo, fixed, ARM, FHA, VA, and USDA

Min. credit score

Conventional, VA:

FHA: 580

Min. down payment


Loan Types

Purchase, refinance, jumbo, fixed, ARM, FHA, VA, and USDA

Quicken Loans Review

Min. credit score


FHA, VA: 580

Min. down payment


Loan Types

Purchase, refinance, jumbo, reverse, fixed, ARM, FHA, VA, and USDA

New American Funding Review
See NerdWallet's pick for best lenders

In This Article

How a Costco mortgage works

The Mortgage Services for Costco Members program is essentially a multi-lender marketplace where consumers can choose from several participating lenders and numerous loan options online, says John Alexander, president and CEO of Affinity Partnerships, the technology administrator of Costco’s mortgage lending platform. First Choice Loan Services, a division of Berkshire Bank, handles the initial customer intake and mortgage leads that come through the platform, he says.

Participating Costco lenders (as of April 2017):

Bank of Internet USA

CapWest Home Loans

eRates Mortgage

First Choice Loan Services

Homebridge Financial Services

J.G. Wentworth



How to apply for a Costco mortgage

Alexander walked NerdWallet through each step of the online application process.

A potential borrower landing on the mortgage website can enter information about a new or existing loan to get more precise rate quotes. You’ll be asked for your Costco membership number, but you won’t be asked for any personal information that would result in a credit check. (Note: Non-Costco members can still get a mortgage with competitive terms, but do not qualify for the fee discounts available exclusively to Costco members.)

» MORE: Monitor your credit score

Next, you can request quotes and compare the results of rates, points, fees and terms from up to four lenders at a time. You’ll then receive emailed summaries from each lender, complete with rate and monthly-payment quotes that are time-stamped and dated. Borrowers have the ability to lock in one of these quoted rates even though they haven’t technically been preapproved. If they choose not to lock, they risk losing the rate they were quoted at the start.

Each lender must offer the same rates and terms at closing that were quoted online as long as the rate was locked on the same day the quote was provided and a borrower’s financial information is accurate and does not change, Alexander says. Otherwise, Affinity will hold lenders accountable.

“We always have the consumer’s back [to ensure] they get the deal they were offered from the start,” Alexander says. “We’re sort of the sheriff in the process, and we monitor every single loan application and investigate any differentials in pricing.”

A look at Costco mortgage products

For starters, Costco’s multi-lender marketplace offers conventional (fixed-rate and adjustable) loans, as well as FHA, VA and USDA loans.

Costco lenders offer Fannie Mae and Freddie Mac’s low down payment programs, which allow buyers to put as little as 3% down, Alexander says.

» MORE: Save confidently for a down payment

Borrowers looking for a jumbo mortgage or a home equity line of credit, or HELOC, will find those options, too, but they won’t find reverse mortgages, Alexander says.

Loan amounts range from as little as $75,000 up to $10 million.

So far, more than 72,000 Costco members have obtained a purchase or refinance loan through the program since its inception in 2010, Alexander notes. On average, most purchase and refinance loans offered through the Costco program close in 17 to 45 days, he adds.

» MORE: Use our mortgage calculator to find out your monthly mortgage payment.

What Costco mortgage does best

  • It caps loan origination fees, which saves borrowers money at closing
  • Costco’s mortgage marketplace gives you access to multiple lenders in one place
  • It has a robust, mobile-enhanced website that automates the entire mortgage-application process

Where Costco mortgage falls short

  • The lending portal doesn’t have a live chat feature, and there are no physical locations
  • You have to become a Costco member to take advantage of the discounted origination fees ($55 per year for Business and Gold Star memberships, and $110 annually for Executive memberships). Membership fees are expected to increase June 1.

More from NerdWallet:
Get Preapproved for Your Mortgage
Compare online mortgage refinance lenders
Tips for finding the best mortgage lender

Deborah Kearns is a staff writer at NerdWallet, a personal finance website. Email: Twitter: @debbie_kearns.


NerdWallet’s star ratings for mortgage lenders are awarded based on our evaluation of the products and services that lenders offer to consumers who are actively shopping for the best mortgage. The six key areas we evaluated include the loan types and loan products offered, online capabilities, online mortgage rate information, customer service and the number of complaints filed with the Consumer Financial Protection Bureau as a percentage of loans issued. We also awarded lenders up to one bonus star for a unique program or borrower focus that set them apart from other lenders. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.