Mr. Cooper Mortgage Review 2020

Good for: borrowers looking for lower credit score requirements and those who don’t mind fully remote customer service.

Kate WoodJuly 30, 2020

Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own.

Our Take

3.0

NerdWallet rating 

The bottom line: Mr. Cooper offers digital tools to manage your application and mortgage, but you'll start by working with a loan officer — you won’t find rates or an application online. Rates and fees also tend to be higher than other lenders.

Mr. Cooper

Mr. Cooper: NMLS#2119

Min. Credit Score

620

Conventional:

620

FHA:

580

VA:

600

Min. Down Payment

3%

Loan Types and Products

Purchase, Refinance, Home Equity, Fixed, Adjustable, FHA, VA

Pros & Cons

Pros

  • Once your loan is in process, offers a robust digital experience.

  • Will consider alternative credit data for FHA borrowers.

Cons

  • Doesn’t offer an online application.

  • Requires a call or email for personalized rates.

Compare to Other Lenders

Min. Credit Score

640

Conventional:

640

FHA:

640

VA:

640

USDA:

640

Min. Credit Score

620

Conventional:

620

Min. Down Payment

3%

Min. Down Payment

3%

Loan Types and Products

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

Loan Types and Products

Purchase, Refinance, Jumbo, Fixed, Adjustable

Full Review

Due to the coronavirus pandemic, getting a mortgage may be a bit of a challenge. Lenders are dealing with high loan demand and staffing issues that may slow down the process. Also, some lenders have increased their fees or temporarily suspended certain loan products. If you can’t pay your current home loan, refer to our mortgage assistance resource. For the latest information on how to cope with financial stress during this pandemic, see NerdWallet’s financial guide to COVID-19.

Mr. Cooper at a glance

Borrowers looking for low-down-payment loans, both conventional and government-backed, have options with Mr. Cooper. The lender offers a robust online experience — but only once your application is underway. To get rate information or learn more specifics on its loan products, you'll have to fill in a form or call to contact the lender.

  • Variety of loan types: 3 of 5 stars

  • Variety of loan products: 4 of 5 stars

  • Online convenience: 4 of 5 stars

  • Rates and fees: 2 of 5 stars

  • Rate transparency: 1 of 5 stars

Mr. Cooper loan types and products

As mortgage lenders go, Mr. Cooper isn't afraid to reinvent itself. Originally known as Nationstar Mortgage Holdings, the lender rebranded as Mr. Cooper in August 2017. Then, in early 2019, Mr. Cooper acquired another lender, Pacific Union Financial, which significantly expanded its presence as a nonbank mortgage originator.

Mr. Cooper wants to create relationships with its borrowers that extend beyond closing day. "We want to build an integrated and unified experience for our customers, which puts the home, rather than the loan, at the center of everything we do," says Neenu Kainth, Mr. Cooper's chief digital officer.

Mr. Cooper’s menu of mortgage options covers most of the usual bases. Available loans include fixed and adjustable-rate purchase and refinance loans.

Mr. Cooper offers both conventional and government-insured mortgages, including FHA and VA loans. Like some other lenders, Mr. Cooper offers down payments as low as 3% on conventional loans and 3.5% on FHA loans, which may be especially helpful for first-time home buyers.

Borrowers who need some flexibility on credit score requirements will also find options at Mr. Cooper: the minimum for FHA loans is 580 and 600 for VA loans. For FHA borrowers with no credit history, the lender may combine nontraditional credit data with manual underwriting to increase the chance of qualification.

Mr. Cooper online convenience

Although Mr. Cooper is licensed to lend in all 50 states, it doesn’t operate any public-facing branches, so the entire mortgage process unfolds remotely. Mr. Cooper doesn’t currently have an online application either, so clicking "apply," or "learn more" on a loan option leads to a contact form.

After submitting the form, a Mr. Cooper home loan professional will contact you to discuss mortgage options and assist with pre-qualification and preapproval.

Once your application is submitted, Mr. Cooper’s Digital Loan Tracker provides real-time progress updates so borrowers can track their application status. In addition to 24/7 tracking, you can view a mortgage to-do list that shows exactly what’s needed to keep the process moving forward. The tracker also allows you to e-sign disclosures, upload financial documents and ask your loan team any questions.

After closing day, Mr. Cooper’s mobile app can help you manage your mortgage and better understand your home’s value. The app gives customers the ability to do more than just view their mortgage balance or make a payment (though it does that, too). Features include detailed information on your home equity, home value trends in your neighborhood and property taxes.

Mr. Cooper mortgage rates and fees

One of the most important considerations when choosing a mortgage lender is understanding what the loan will cost. In order to provide consumers with a general sense of what a lender might charge, NerdWallet scores lenders on two factors regarding fees and mortgage rates:

  • A lender's average origination fee compared with the median of all lenders reporting under the Home Mortgage Disclosure Act. Mr. Cooper earns 2 of 5 stars on this factor.

  • A lender's offered mortgage rates compared with the best available on comparable loans. Mr. Cooper earns 2 of 5 stars on this factor.

If you are a current Mr. Cooper customer, you may be eligible for a rate discount. According to their website, existing customers seeking a purchase loan may be eligible for a credit of 0.5% that's used to buy discount points. That translates to about $500 for every $100,000 financed.

Borrowers should consider the balance between lender fees and mortgage rates. While it's not always the case, paying upfront fees can lower your mortgage interest rate. Some lenders will charge higher upfront fees to lower their advertised interest rate and make it more attractive. Some lenders just charge higher upfront fees.

You can decide to buy discount points — a fee paid with your closing costs — to reduce your mortgage rate.

Deciding whether to pay higher upfront fees is a matter of considering how long you plan to live in your home and how much cash you have to apply toward closing costs when you sign the loan paperwork.

Mr. Cooper mortgage rate transparency

Customers hoping to do a little rate shopping on Mr. Cooper's website will be disappointed. No mortgage rates are published online — not even general estimates. You'll have to submit contact information through the online form or call to get a personalized rate quote.

More from NerdWallet:

NerdWallet’s star ratings for mortgage lenders are awarded based on our evaluation of the products and services each lender offers to consumers who are actively shopping for the best mortgage. The five key areas we evaluated include the variety of loan types and products offered, online conveniences, online mortgage rate information, and the rate spread and origination fee lenders reported in the latest available Home Mortgage Disclosure Act data. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.