Editor’s note: Mortgage company Sindeo announced on June 20 that it ceased operations, effective immediately. You can read the company’s note to users on its website. If you’re looking for information on home buying and home ownership, you can visit NerdWallet.
It’s the mortgage mantra of NerdWallet: To get the best rate on a home loan, shop multiple lenders. Technology is making that task easier — and one company is hoping to become a one-stop solution. Sindeo calls itself a mortgage marketplace, aiming to offer a “better way to get a mortgage.” Let’s see if it lives up to that aspiration.
AT A GLANCE
- Currently works with 45 lenders.
- Available in Arizona, California, Colorado, District of Columbia, Florida, Michigan, New Jersey, Oregon, Tennessee, Texas and Washington.
- Mortgage advisors are not paid commissions based on the size of loans.
Not a broker, a ‘mortgage marketplace’
Ori Zohar and Nick Stamos started Sindeo about three years ago. Stamos launched a mobile analytics firm at the height of the dot-com craze in the late 1990s and later sold the company to Nielsen, best known as a television ratings firm. Zohar has a marketing background, having worked at blue-chip advertising agencies, and with an entrepreneurial spirit of his own, has been launching enterprises since age 15.
Zohar prefers to call Sindeo a “mortgage marketplace” rather than a mortgage broker. He says brokers tend to work with just two or three lenders, whereas Sindeo has a roster of 45.
And, he says, there’s an even more important distinction. “Mortgage brokers tend to be paid by deal size; the bigger the deal, the more they get paid,” Zohar says. Sindeo mortgage advisors are paid a salary plus a flat fee per the number of loans they close, as well as a quarterly bonus based on customer satisfaction.
“One of the benefits of a marketplace: If you’re a foreign national and don’t have a Social Security number, we have lenders for that,” Zohar says. “If you’re a recent graduate and don’t have a credit history, we have lenders for that. If you were recently bankrupt, or whatever it may be, that’s our goal — to say, ‘Regardless of who you are or what your background is or what your mortgage goal is, you come to us.'” Sindeo doesn’t, however, do commercial real estate loans.
Typical Sindeo customers apply for purchase loans of just over $500,000 and refinances of about $350,000. Buyers are an average age of 33, while refinancers are in their early 40s, both with average credit scores over 700.
How Sindeo works
The home loan process at Sindeo.com begins by entering some personal and property details after punching the “Get Started” button. It’s typical stuff: Are you buying or refinancing? The expected loan size, your down payment and credit score; things like that.
After you enter the information, Sindeo highlights a “suggested loan,” as well as the estimated payment, interest rate and annual percentage rate for alternatives such as 30-year fixed, 15-year fixed, and 7/1 and 5/1 adjustable rate loans. Although Sindeo doesn’t display the lenders’ names, you’ll see different offers with the estimated fees or credits and rates for each loan option.
What you won’t see are offers from 45 different lenders.
“We take the information that our customers provide in the rate quote and pair them with lenders based on a combination of what they can afford, what they’re eligible for and rate,” Zohar says. “Rather than asking our customers to sort through a long list of loans, we do the matchmaking behind the scenes.”
Remember, these are just estimated loan terms. If you like what you see, you can move on to the mortgage application process by registering for an account. Once signed in, you’re assigned a mortgage advisor who can complete the application for you, or you can simply continue online, reaching out to the advisor as needed.
Now the boilerplate questions all lenders are required to ask come into play. However, the online question-and-answer mode is easier than wading through a paper application on your own, as the system presents only relevant questions based on prior responses. Helpful definitions, explanations and tips are displayed alongside each question to guide you along.
Once you complete all the info, you get to a big green button labeled, “Yes, pull my credit report.” Within moments you’ll see your credit scores — and most importantly, the middle score that lenders use.
From there, you go through the declarations (“Do you have outstanding judgments? Do you intend to occupy the property as your primary residence?” and so on), review your info and, if you’re ready to proceed, click on the “Prequalify me” button.
That’s when the official pre-qualification decision occurs. A picture of what seems to be a bubble bath appears on the screen for your “moment of Zen” while you wait for the result.
If all goes well, you can print out a pre-qualification letter and get ready to start house hunting. For final approval, you’ll also need to upload documents — such as your driver’s license, bank statement and W2 forms — and, as with any lender, the loan will have to pass underwriting approval.
How Sindeo gets paid
While Sindeo says it’s paid “by the lenders,” the fee it charges on every loan comes out of your pocket. It’s not a set fee but varies by loan product and lender.
“That’s how we get paid, and it’s baked into the ultimate APR that [borrowers] pay for the loan,” Zohar says. “By choosing Sindeo, people, on average, save over $20,000 over the life of their loan.”
The thing is, that savings claim is based on specific parameters and competitors’ published rates, not a result of side-by-side comparisons of completed applications. Bottom line: If Sindeo can earn its fee by getting you a better rate, you’ll be able to tell by comparing your APR and total costs on the official loan estimate provided by Sindeo with that of other lenders where you also apply.
What Sindeo does best
- Sindeo offers an elegant interface and makes the application process just about as easy as currently possible.
- Your application is shopped to multiple lenders with a single credit pull.
- You have a dedicated mortgage advisor to help you navigate the process and answer questions and concerns.
Where Sindeo falls short
- Sindeo currently is available in only nine states and Washington, D.C.
- As a broker, Sindeo charges a fee, which is calculated into the APR.
If you don’t want to slog through the mortgage process alone, Sindeo’s combination of technology and personal assistance may be just what you’re looking for.