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K. Hovnanian American Mortgage Review: Big Mortgage Rate Deals for Home Builder Customers

new home

Today we’ll take a look at another home builder’s lender, K. Hovnanian American Mortgage.

They are the affiliated lender of K. Hovnanian Homes, which is a top-15 home builder nationally.

Like other builders, they created their own financing division to streamline their new home sales.

And to better control the customer experience from start to finish.

The biggest perk to using them is the financing specials you likely won’t find elsewhere. Read on to learn more.

K. Hovnanian American Mortgage Fast Facts

  • Affiliated mortgage lender for K. Hovnanian Homes
  • Provides home purchase loans for new home buyers
  • Founded in 2002, headquartered in Boynton Beach, FL
  • Parent company is one of the largest home builders nationwide
  • Licensed to do business in 14 states and the District of Columbia
  • Funded more than $1.1B in mortgages last year
  • Most active in the states of Arizona, California, Delaware, Texas, and Virginia

As noted, K. Hovnanian American Mortgage is the lending division of K. Hovnanian Homes, a top U.S. home builder.

Their parent company Hovnanian Enterprises, Inc. is a publicly traded company (NYSE:HOV), currently valued at nearly $1 billion dollars.

They’ve been around since 1959, and operate 128 residential communities across 14 different states.

Those states include Arizona, California, Delaware, Florida, Georgia, Illinois, Maryland, New Jersey, Ohio, Pennsylvania, South Carolina, Texas, Virginia, West Virginia, and Washington, D.C.

These are the places where K. Hovnanian American Mortgage is licensed to lend as well, since they only exist to serve their home buyer customers.

In fiscal year 2022, they delivered more than 6,000 homes to buyers across all markets, putting them in the top-15 largest homebuilding companies in the United States.

The lending unit got its start way back in 2002 and is headquartered in Boynton Beach, Florida. At present, they have 36 licensed mortgage loan originators working at the company, per the NMLS.

Because they are a home builder lender, they only offer home purchase loans. No mortgage refinances are available.

But they also operate a full-service title company called Eastern National Title Agency and Hovnanian Insurance Agency.

So you can get your new home, mortgage, title insurance, escrow services, and even homeowners insurance all from one umbrella company.

Of course, it can pay to shop around, so don’t overlook savings for convenience.

How to Apply for a Loan

To get started, you can visit a new home sales office or visit their website. Either way, you’ll be put in touch with a licensed loan officer.

They’ll be able to discuss pricing and loan options with you. If you like what you hear, you can proceed to the loan application.

It’s a digital app powered by ICE Mortgage Technology that can completed from any device, including a computer, tablet, or smartphone.

It allows you to link bank accounts and other financials, upload key documents, and eSign disclosures on the fly.

Once submitted, you’ll be able to check loan status 24/7 to determine what outstanding items still need to be completed. And you can get in touch with your lending team whenever you have questions.

Ultimately, they make it easy to apply for a home loan thanks to the latest tech, but also have a human lending team standing by.

Note that loans are sold off to a third party after closing because they are not a loan servicer.

Loan Programs Offered by K. Hovnanian American Mortgage

  • Home purchase loans
  • Conforming loans
  • Jumbo loans
  • FHA loans
  • VA loans
  • USDA loans
  • Fixed-rate loans: 30-year fixed, 15-year fixed
  • ARM loans: 5/6 ARM, 7/6 ARM
  • Buydown loans: 3/2/1 and 2/1 buydowns
  • State bond loans

Despite being a home builder lender, K. Hovnanian American Mortgage offers a good variety of loan programs, including conforming loans backed by Fannie Mae and Freddie Mac and jumbo loans.

They also offer all the major government-backed mortgages, including FHA loans, VA loans, and USDA loans.

In addition, you can get either a fixed-rate loan, such as a 30-year or 15-year fixed, or an adjustable-rate mortgage, such as a 5/6 ARM or 7/6 ARM.

Given the recent rise in mortgage rates, they also offer buydown loans, including a 3/2/1 buydown that discounts the rate a full three percentage points in year one.

You might also be able to get your hands on some homebuyer assistance via select state bond loans that offer lower down payments and government subsidies.

K. Hovnanian American Mortgage Rates

While some mortgage companies post their daily mortgage rates online, K. Hovnanian American Mortgage does not.

With regard to how their interest rates are, they simply say, “There is no way to accurately and honestly answer this question without first evaluating your individual situation and financing needs.”

In other words, mortgage rates vary by customer, based on loan parameters such as credit score, down payment, loan program, and so on.

The good news is they may offer special financing offers to their new home buyers, as is often the case with affiliated builder lenders.

Because builders often buy forward commitments in bulk, they can apply special discounts that are often hard for outside lenders to beat/match.

But these deals are often limited to certain homes in specific developments, and the funds are subject to running out.

They are also time-limited, meaning you must get under contract and/or close by X date to use these special funds.

When you speak to a new home buying rep or loan officer, be sure to inquire about deals such as permanent or temporary rate buydowns.

This may come in the form of a closing cost credit, which can be applied to a mortgage rate buydown.

These can make or break your decision to use the home builder’s lender or an outside bank/lender.

K. Hovnanian American Mortgage Reviews

There aren’t a ton of reviews for the lending arm of K. Hovnanian. But they do have a few kicking around.

They’ve got a 4.3/5-star rating from six reviews on Redfin, and a perfect 5/5 on a separate Redfin page from five reviews.

Meanwhile, their parent company has a 4.3/5 from nearly 4,000 reviews on NewHomeSource, which is a much better sample size.

And given the fact that most of the parent company’s home buyers are likely also mortgage customers, these should be relevant.

Of course, it’s not all perfect. Over at ConsumerAffairs they have a much more questionable 1.4/5 from over 250 customer reviews.

So a bit of a mixed bag, though some reviews may have to do with the properties themselves, not the mortgages.

Be sure to take the time to read through the reviews to determine potential hiccups that you might be able to avoid.

Lastly, they are an accredited company with the Better Business Bureau (BBB) and currently hold an ‘A+’ rating based on complaint history. Speaking of, they have zero complaints on file.

To sum things up, K. Hovnanian American Mortgage seems to offer a good mix of technology, a full loan menu for home buyers, and decent customer reviews.

They also have the huge advantage of offering below-market mortgage rates like other home builder lenders.

But always gather more than a single mortgage quote. While K. Hovnanian American Mortgage may offer the best pricing, there might be better deals out there.

And if you have competing quotes, they may be more willing to negotiate with you on rate and/or closing costs.

K. Hovnanian American Mortgage Pros and Cons

The Pros

  • Can apply for a home loan online
  • Digital mortgage application powered by ICE Mortgage Technology
  • Plenty of loan programs to choose from
  • Offer mortgage rate specials for home buyer customers
  • Lots of excellent customer reviews
  • A+ BBB rating, accredited company
  • Lots of free mortgage calculators on their website
  • Extensive mortgage glossary explaining key terms

The Cons

  • Only offer home purchase loans
  • Aren’t licensed in all states
  • Do not publicize mortgage rate or lender fees
  • Some mixed reviews for parent company
  • Do not service loans after closing

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