PenFed Mortgage Review | The Ascent

Top perks

Cash offer equivalent

PenFed offers a mortgage program called the Power Buyer loan. It’s a fully underwritten pre-approval that results in a 60-day commitment to lend, provided none of your details materially change prior to closing. There is also a selling component that helps you free up assets so you don’t have to make offers that are contingent on selling your current home. PenFed allows you to tap equity to make a cash offer on the home you want to buy. The Power Buyer loan comes with a 60-day rate lock. The rate lock can be extended for an additional 30 days for a fee.

Low down payment home loan options

PenFed offers several ways to get a mortgage with a low or no down payment. Those who qualify for a VA loan do not need to make a down payment at all. Low- and moderate-income borrowers can get a mortgage with 3% down. Other borrowers can get a mortgage with 5% down.

VA loan experts

PenFed has decades of experience serving the global military community.

Membership benefits

As a member of PenFed Credit Union, you will be able to take advantage of all the benefits they offer. Here are just a few examples:

  • Car buying service with free Carfax and TrueCar reports
  • Car insurance discounts
  • Car rental discounts
  • Auto maintenance discounts
  • Tax preparation software discounts
  • Home insurance discounts
  • Cellphone service discounts

Rate quote tool and very low rates

PenFed is an industry leader when it comes to low mortgage rates. If you are willing to enter your email address, you can use PenFed’s convenient rate tool to find out what rate you might qualify for based on the information you provide. You can use this tool to play around with your credit score and down payment amount to see how those details might affect your eligibility. That can help you decide whether it’s worth it to wait a few months while you try to improve those numbers before you apply.

Rate lock

PenFed’s pre-approval comes with a 60-day rate lock. If you need more time, you can extend the rate lock for 30 days one time (for a fee).

Financial incentives

For borrowers getting a loan to purchase a home, PenFed offers $500 to $2,500, depending on the loan size, in lender credits. Not all loans are eligible, so be sure to ask about this before you apply.

At the time we checked, PenFed was also offering a $500 closing credit to all new refinance applicants. That offer may expire, but other bonus offers pop up from time to time.

What could be improved

Members only

You have to be a PenFed member to get a mortgage there. That means you’ll have to at least maintain a savings account with the credit union. That might be inconvenient if you were not looking to open a new bank account. On the plus side, however, the minimum opening balance is just $5, and there is no monthly maintenance fee.

No free float down

PenFed’s rate lock does not float down. If rates fall before you close on your loan, you will need to pay a fee to get the lower rate.


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