Editorial Review

Alterra Home Loans Review 2019

Ideal for minority borrowers, first-time home buyers and those with nontraditional incomes.

Deborah KearnsMay 28, 2019

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Our Take

4.5

NerdWallet rating 

The Bottom Line: Alterra offers low-down-payment loans and will consider nontraditional credit and income sources.

Alterra

Alterra: NMLS#133739

Min. Credit Score

620

Min. Down Payment

3%

Loan Types and Products

Purchase, Refinance, Jumbo, Fixed, Adjustable, FHA, VA, USDA

Pros & Cons

Pros
  • Offers an ITIN qualification path for undocumented immigrant borrowers.

  • Has a digital application process.

  • Offers several mortgage options for low- to moderate-income borrowers.

  • Has a full Spanish-language version of its website and bilingual loan officers.

  • Borrowers can qualify with income from self-employment and other nontraditional sources.

Cons
  • No mortgage rates published online.

  • Doesn't lend in all states.

  • No home equity loans or lines of credit.

Compare to Other Lenders

Quicken Loans
Better.com
Min. Credit Score

620

Min. Credit Score

620

Min. Down Payment

3%

Min. Down Payment

3%

Loan Types and Products

Purchase, Refinance, Jumbo, Fixed, Adjustable, FHA, VA, USDA

Loan Types and Products

Purchase, Refinance, Jumbo, Fixed, Adjustable, FHA

Full Review

Alterra Home Loans offers a wide variety of mortgage products with options that include low-down-payment mortgages for entry-level buyers and conventional loans for well-qualified borrowers.

Alterra is also focused on expanding access to homeownership for underrepresented minority groups by offering a variety of loans with flexible qualification requirements.

Since its founding in 2006, Alterra has grown its operations to cover more than half the country, with the goal of eventually lending in all 50 states, says Jason Madiedo, president and CEO of Alterra Home Loans.

Here's a closer look at Alterra Home Loans and its mortgage offerings.

Alterra mortgage products

Alterra has a wide variety of mortgage options. You’ll find the usual stable of conventional fixed- and adjustable-rate purchase loans in amounts ranging from $50,000 to $2 million.

Additionally, Alterra offers several government loan options, such as VA loans guaranteed by the U.S. Department of Veterans Affairs and USDA loans guaranteed by the U.S. Department of Agriculture. However, FHA loans (insured by the Federal Housing Administration) represent the bulk of the lender's government business, Madiedo says.

Alterra doesn’t offer home equity lines of credit or loans, but it does offer refinancing options across product types, as well as cash-out refinancing.

Alterra's focus: minority and first-time buyers

The company’s name, Alterra, means “alter” or “change” in Spanish. And Madiedo sees the company as an agent of change for how Latino and other minority borrowers experience home lending. Alterra says minority borrowers account for 80% of its customers.

The same issues that may create roadblocks for people in those groups — not having enough for a down payment, not having a long traditional credit history, having an unconventional work situation — also make it hard for many millennial home buyers to break into the market, Madiedo says.

To that end, Alterra Home Loans has adapted its underwriting model to consider borrowers who have seasonal jobs or are self-employed. It also aims to make home loans available for multigenerational households where other family members contribute to household bills.

“With Hispanic households, you’ll see grandparents living with their adult children and young grandchildren, and you could have several adults working various jobs to contribute to the household,” Madiedo says. “We’re also seeing a lot more millennials with dynamic incomes besides their day jobs, like driving for Uber or renting out a room on Airbnb. We’re comfortable with serving these consumers the way they want to be served.”

Alterra also offers an Individual Taxpayer Identification Number (ITIN) loan product to undocumented immigrant borrowers. Qualifying for an ITIN mortgage product is much more rigorous because borrowers must have a 20% down payment, have two years of employment in the same type of work and show two years of tax returns using their ITIN number, Madiedo says. The interest rates for these loans are significantly higher, he adds.

Despite these added costs, Madiedo says Alterra has helped hundreds of immigrant families become homeowners.

Alterra mortgage process

At Alterra’s site, potential borrowers can complete an online form with basic loan details and contact information. Once that information is submitted, they’ll have the option to continue to a full loan application. A loan officer will then contact them to finish the loan approval process. Those who prefer face-to-face service can apply at one of the several dozen Alterra branches in 17 states.

Once a loan file is opened, customers can log in to Alterra’s online loan servicing portal, which is integrated with its mobile app. From there, they can track the progress of their loan, upload documents, sign paperwork electronically and have their employment verified online, too, says Walmer Medina, creative director at Alterra.

To appeal to younger, more digitally savvy customers, the company created a new mobile app called Alterra Pronto, Madiedo says.

“Pronto,” which means “soon” in Spanish, makes an online application and loan communications accessible via mobile devices. Another feature: The app brings all of the parties involved — buyers, sellers, real estate agents, relatives, title agents, attorneys and appraisers — together to monitor the loan process until it gets to the closing table, Madiedo says.

“We want to have as much transparency as possible while reducing friction in communications, and we’re using technology to fulfill those goals,” Madiedo says. “For many millennial home buyers, this is their first experience buying a home, so they might want a parent or sibling to be part of it.”

Alterra says it takes 22 days, on average, to close a conventional conforming loan.

Alterra mortgage rates and fees

Potential borrowers who are trying to compare mortgage interest rates across lenders will likely be disappointed: Alterra’s website doesn't display that information. The lender says free rate locks are available for 30, 45, 60 and 180 days, though this service isn’t mentioned on the site either.

Alterra says it charges a $995 underwriting fee on conventional conforming loans.

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.