Quicken Loans is built for the “click here” generation, people who think doing business face-to-face is overrated. In fact, it famously describes the application process on its Rocket Mortgage interface as, “Push button. Get mortgage.”
Quicken Loans couples a fully online application with available mortgage advisors for those who want a human touch. This combination, along with the wide variety of loan products it offers, helped Quicken become a leading national mortgage lender and the largest FHA lender in the country.
Rocket Mortgage is Quicken’s online-only interface. Through the Rocket Mortgage website or mobile app, users can easily upload financial details and get a loan decision in minutes. With the same underwriting standards as Quicken Loans, Rocket gives users access to leading programs for first-time homebuyers.
Here’s how Quicken Loans and Rocket Mortgage stack up.
AT A GLANCE
- Offers fixed-rate loans of 8-30 years.
- Offers 5/1, 7/1, 10/1 ARMs.
- Minimum credit score of 620 (580 for FHA loans).
Quicken/Rocket provides just about all the services your neighborhood lender does: Fixed- or adjustable-rate home loans, mortgage refinancing, FHA and VA loans and “jumbo” loans. It’s not only the biggest online mortgage lender in the U.S., it’s the third-largest home loan lender — online or otherwise — behind Wells Fargo and Chase, according to trade publication Mortgage Daily. It originated a whopping $79 billion in mortgages in 2015.
An online mortgage lender goes even more virtual
Quicken Loans was already an online lender, but it repositioned itself as even more virtual when it introduced Rocket Mortgage — which is a service portal, not a separate company. Beneath the new Rocket technology are the same underwriting standards of the Quicken mother ship.
You can speak with a mortgage advisor anytime by pushing the “Talk to Us” button on every Rocket Mortgage page, but the site caters to self-service users who want to apply for a home loan without talking to a human unless it’s absolutely necessary.
“What Rocket Mortgage does is, it gives the client the ability to price their own loan, pick their interest rate, the points, understand the trade-off to go with a higher rate and less points, et cetera,” says Bob Walters, chief economist of Quicken Loans. “It allows them to lock that interest rate. It allows them to e-sign and create the original application without speaking to anyone.”
What Rocket Mortgage does best
- Instantly verifies employment and income for more than 60% of working Americans.
- With your authorization, downloads asset statements from 95% of U.S. financial institutions.
- Tells you the loan amount you’ll qualify for within minutes.
- Offers custom fixed-rate loan terms of between 8 and 30 years.
- Provides first-time homebuyers FHA-backed loans, as well as products offered by Freddie Mac and Fannie Mae that require down payments as low as 3%. “Quicken Loans is the largest and highest-quality (lowest default rate) FHA lender in the country,” according to a company-provided data sheet.
Rocket Mortgage’s document and asset retrieval capabilities alone can save you a bunch of time and hassle. Eventually every lender will do this — or be left behind.
Considering fees and mortgage rates
“One of my great pet peeves in this industry over the years has been a lot of people advertise a low rate with a bunch of asterisks, and then by the time you get into the process, you realize that’s not the rate you’re going to get,” Walters says.
But he also thinks the days of low advertised rates with fine-print disclaimers are fading fast. He says the industry is now so highly regulated — and becoming so transparent — that every lender’s fees and mortgage rates are nearly the same.
Rocket Mortgage users
Rocket Mortgage users are more likely to buy than refinance. They’re also slightly younger and tend to have a little bit better credit than Quicken Loan users, according to Walters.
“Client focus and technology: That’s what differentiates us,” Walters says. Another distinction, he says: Quicken Loans doesn’t sell its loans to servicers. In other words, you don’t get the mortgage from them, only to deal with a different company down the road.
“I think that branch loan officer is a dying profession.”
Through 2016, Quicken Loans has been awarded seven consecutive J.D. Power customer satisfaction awards for loan origination. Walters believes that’s a sign of things to come.
“I think that branch loan officer is a dying profession,” he says.
How Rocket Mortgage works
If you apply for a purchase mortgage or refinance through Rocket, you’ll first create an account and provide the usual personal information. For instance, to apply for a refinance, you’ll input your current mortgage details. Typing in your home’s address automatically imports property data, including the year your home was built.
You can add income details yourself, or, if you provide your birthday and Social Security number, the system will perform a search and fill them in for you.
“What’s nice about this is two things,” Hadiaris says. “It makes it easier for the person filling out this information, but at the same time, the system has done an electronic verification of income already, so it is actually starting the process of doing income calculations.”
Those calculations are a proprietary analysis of your income information. Algorithms are beginning to build your customized home loan recommendations.
Next, you’ll enter your asset information, or have it automatically imported. Rocket can pull data about products such as checking, savings and investment accounts from 95% of U.S. financial institutions.
When you click the button, Rocket gathers your credit score and history from all three credit bureaus, and compares the results with Quicken Loans’ mortgage underwriting guidelines.
An entertaining “T-Minus” countdown appears on the screen. After a few minutes, it’s replaced by details about your customized mortgage options. Slider bars allow you to change the closing costs, loan term and interest rate until you’re happy with the results. Then click the “See If I’m Approved” button, and within minutes you’ll get a loan approval — or not.
If you’re approved, you can lock your interest rate and print out an approval letter, then hit the road and start house hunting. Once you have a purchase contract on a home, the loan details are finalized, and the package goes through the usual underwriting process: ordering an appraisal, verifying a clear title and all the rest.
If your loan application is denied, you can speak or chat online with a mortgage banker to find out why and what you can do to be approval-worthy.
Where Quicken Loans and Rocket Mortgage fall short
Even though Quicken/Rocket is a leading full-service lender, there might be drawbacks for some customers:
- Quicken/Rocket doesn’t offer home equity loans or home equity lines of credit.
- If you’re a “look me in the eye” type of customer, you’re out of luck.
- Quicken Loans doesn’t consider alternative credit data. It just looks at credit scores and debt-to-income ratios, the way most mortgage lenders always have.
If you like to shop online and enjoy using a streamlined and efficient app, with live help a quick click away, Quicken Loans and Rocket Mortgage might be just what you’re looking for.
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Hal Bundrick is a staff writer at NerdWallet, a personal finance website. Email: firstname.lastname@example.org. Twitter: @halmbundrick.
Updated Jan. 11, 2017NerdWallet’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.