NASB Mortgage Review 2019
Ideal for active military members and veterans as well as for borrowers with less-than-perfect credit or nontraditional income sources.
The Bottom Line: NASB offers a full range of home loan options, with a focus on serving military families.
Pros & Cons
- Devotes much of its business to serving military families with VA loans.
- Considers nontraditional income sources.
- IRA nonrecourse loans for buying investment property.
- Mortgage rates available online.
- No online application or loan process tracking.
- Charges online payment fees if you don't have an NASB checking or savings account.
A regional bank and national lender located in Grandview, Missouri, North American Savings Bank offers mortgages that appeal to a wide range of borrowers, with a focus on U.S. military veterans and active-duty members.
About 70% of NASB’s mortgages are made through the U.S. Department of Veterans Affairs, according to Dan Reynoldson, vice president of NASB’s internet lending division.
Let’s see how NASB Mortgage stacks up for home-loan shoppers.
Getting started with NASB
You can start the mortgage process in person if you live near a branch, or if you prefer you can call or start online. Online you’ll fill out a simple contact form, and a loan officer will reach out to you to continue the process.
You’ll also have access to an optional online account that allows you to sign and submit documents. The online account doesn’t include any kind of step-by-step tracker that lets you follow the status of your application, according to Reynoldson. Your loan officer will give you updates along the way.
If you want to make payments online, you’ll have to create an account. If you use a credit or debit card to make payments, you’ll have to pay a $44.55 fee each time. The same is true if you use a non-NASB bank account, but the fee is much smaller: $2.75. The same $2.75 fee is charged if you pay by check, according to the loan servicing department.
Depending on the loan, NASB Mortgage will look beyond a less-than-perfect credit score at things like your history of mortgage, rent, utility, insurance or even cell phone bill payments, according to Reynoldson.
And the website says the waiting period for getting mortgage approval after filing for bankruptcy is much shorter than many customers expect, and it can be as short as one day. This depends on the type of loan you’re applying for, sales team leader Geoff Miller says. With a VA loan, for instance, you can be in the middle of Chapter 13 bankruptcy and still get the loan. Miller points out that this isn’t specific to NASB, that all government loans like VA and FHA follow certain requirements for bankruptcy.
NASB does not charge a fee for locking in the rate on your loan. The company charges an origination fee of $995 on all its loans except those made through the VA program.
NASB mortgage products
According to Reynoldson, NASB ranks as one of the top 15 VA lenders in the country. “We really pride ourselves on serving that community,” he says. NASB’s website says the company has helped over 15,000 veteran homeowners close more than $4.5 billion in home loans over the past six years.
VA loans through NASB are available for both purchase and refinance, including cash-out refinance. Since you’re using your home as collateral, you may want to think twice if you’re using a cash-out refinance for anything besides a project that increases the value of your home.
If you already have an FHA loan and are thinking of refinancing with NASB, you may be able to do an FHA Streamline Refinance. This type of refinance involves less paperwork than a traditional refinance.
IRA non-recourse loans
NASB also offers IRA non-recourse loans for investment properties. Borrowers with a self-directed Individual Retirement Account, which is an IRA with fewer restrictions on investments and allows you to invest in real estate, can use money from their IRAs to pay for an investment property. The money from the IRA account pays for all the expenses related to buying and owning the home, including property taxes, insurance and maintenance costs.
If the borrower defaults and the home is foreclosed, the IRA account is protected from the creditor; only the home is collateral. That’s what makes this type of mortgage a non-recourse loan.
Non-recourse loans are for investment purposes only — the property can’t be for your primary residence. Your IRA must be self-directed because larger brokerages that handle IRAs don’t allow real estate as part of the portfolio products they offer, according to Matt Allen, vice president of portfolio lending with NASB.
These loans can come with higher interest rates than your normal mortgage, and NASB requires a minimum down payment of 30%. Like all property-related expenses on the loan, the down payment must come from the IRA account. Because these costs aren’t considered a distribution from the account, they aren’t taxed. There are no limits on the loan amount, and the loan can be used for purchase or refinance at both fixed and adjustable rates. In some cases, taxes may apply, but you’ll still get to take deductions out, Allen says.
The typical NASB investor who’s purchasing property through a self-directed IRA is at least 40 years old and has a minimum of $50,000 in his or her retirement plan, Allen notes. Often these individuals are working in real estate in some capacity. A non-recourse loan might be a good option if you own more than four units in your name and you’re having difficulty getting a conforming loan because of the limitations on those loans.
NASB’s Good Neighbor program
NASB’s Good Neighbor Home Loan Program is for low- to moderate-income borrowers, or for borrowers who live in low- to moderate-income areas in and around Kansas City, Missouri. To qualify, you need a minimum credit score of 580. There are no lender fees, and NASB offers closing cost assistance with this program.
The Good Neighbor Discount Program is available if you’re not using NASB’s Good Neighbor Home Loan Program, and if you live in specified low- to moderate-income areas in Missouri. Through this program, you’ll get a discount on other loan programs. It’s available for purchase or refinance, and for owner-occupied or investment properties. There are no lender fees, and NASB provides closing cost assistance.