New American Funding Mortgage Review 2021

Good for: borrowers who need to be evaluated on the basis of nontraditional credit and those interested in various down payment assistance programs.
Phil MetzgerDec 2, 2021

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Our Take

5.0

NerdWallet rating 

The bottom line:

New American Funding offers a large menu of loan products, including government loans; it has an online application and just under 200 branches in 49 states and the District of Columbia.

New American Funding

at New American Funding

Min. Credit Score

620

Min. Down Payment

3%

Loan Types and Products

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

Pros & Cons

Pros

  • Uses manual underwriting to evaluate creditworthiness, in some cases.
  • Offers a fully online mortgage application, rate quotes, document upload and loan tracking.

Cons

  • Mortgage origination fees tend to be on the high end, according to the latest federal data.

Compare to Other Lenders

NerdWallet rating 
NerdWallet rating 
NerdWallet rating 
Min. Credit Score

620

Min. Credit Score

640

Min. Credit Score

620

Min. Down Payment

3%

Min. Down Payment

3%

Min. Down Payment

3%

Loan Types and Products

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

Loan Types and Products

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

Loan Types and Products

Purchase, Refinance, Jumbo, Fixed, Adjustable, FHA

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Full Review

The coronavirus pandemic introduced some new challenges to getting a mortgage. Many lenders facing high loan demand and staffing issues increased their fees, adjusted minimum required credit scores or temporarily suspended certain loan products. While some products and business practices have returned to pre-pandemic levels, you might still find delays and limited options. If you can’t pay your current home loan, refer to our mortgage assistance resource. For information on how to cope with financial stress during this pandemic, see NerdWallet’s financial guide to COVID-19.

New American Funding is among the very few national mortgage lenders that can claim to be family-owned. Sure, there are small mom-and-pop lenders in communities across the nation that can make the same claim, but New American Funding has grown into a top 20 national lender, based on the latest loan origination volume data compiled under the Home Mortgage Disclosure Act.

Founded in 2003 by Rick and Patty Arvielo in Orange County, California, New American Funding has grown to be a $29 billion lender with a national profile and an emphasis on serving the underserved.

New American Funding at a glance

In 2020, over 18% of New American Funding's home purchase loan volume was attributed to Hispanic customers, and over 12.4% of its home purchase loan volume was to Black borrowers (compared with national numbers of 11.9% and 6.7%, respectively).

Here's a breakdown of New American Funding's overall score:

  • Variety of loan types: 5 of 5 stars

  • Ease of application: 5 of 5 stars

  • Rates and fees: 3 of 5 stars

  • Rate transparency: 5 of 5 stars

New American Funding mortgage loan types

New American Funding is a nonbank lender with a good selection of loan products, including purchase, refinance and more. Government-backed loans are in the mix, with FHA and VA mortgages. New American Funding also features cash-out refinance loans. And you can choose from fixed-rate and adjustable-rate terms.

The lender also offers jumbo loans in some cases. To learn about applying for a jumbo loan, borrowers can call or fill out a contact form on the New American Funding website.

New American Funding offers reverse mortgages, which are not always on the menu at typical mortgage lenders.

The lender also has first-time home buyer programs and works with borrowers to find state and local down payment assistance programs.

New American Funding HELOC: New American Funding appears to offer a home equity line of credit, or HELOC. These second mortgages are one way for homeowners to access existing home equity without refinancing or selling their home. Funds obtained with a second mortgage can be used for expenses such as home improvements, education costs or debt consolidation. The New American Funding website has information about HELOCs in general, but you'll need to contact the lender for specific details.

New American Funding ease of application

Your loan application can begin in person, by phone or online. Documents can be uploaded, and electronic signature is also available.

Average closing time is less than 35 days, New American Funding says, and there is no charge for an interest rate lock.

A prequalification can be initiated online, though you will need to contact New American Funding before it issues a pre-qual letter.

With the ability to use manual underwriting, New American Funding can look at each borrower's financial picture more comprehensively, rather than relying solely on automated models, according to Frank Fuentes, national vice president of multicultural community lending.

"That’s a huge advantage for us in working with underserved markets," Fuentes says. "We take a 'makes-sense' approach to underwriting loans, whether it's a purchase or refi, and we aren't quick to deny a loan. We look at the customer's profile from all different angles."

English/Spanish bilingual agents are available to assist. New American Funding customer service is available from 8 a.m. to 9 p.m. Central time on weekdays and 10 a.m. to 2 p.m. on Saturdays.

New American Funding 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, according to the most recently available Home Mortgage Disclosure Act data:

  • New American Funding earns 2 of 5 stars for average origination fee.

  • New American Funding earns 3 of 5 stars for offered mortgage rates compared with the best available rates on comparable loans.

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.

New American Funding mortgage rate transparency

If you’re looking for information on interest rates, tap on "Mortgage Rates" from the menu and you'll see rates and APRs for four popular loans.

Drilling down on "View Disclosures" shows you the fine print.

On the day we looked, the disclosures showed that New American Funding was including two discount points and considering a 60% loan-to-value on conventional loans to sweeten its advertised fixed mortgage rates. It's a good idea to look for clues like these when shopping rates online so that you won't be disappointed when you are quoted a higher rate.