New American Funding Review: A Direct Lender That Isn’t Shy About Sharing Its Mortgage Rates

It’s time for another mortgage review, this time we’ll take a hard look at “New American Funding” to see if they should be included in your home loan search.

They call themselves a family-owned business dedicated to helping other families improve their quality of life.

That sounds like they have your best intentions in mind, especially when navigating what is arguably one of the biggest life decisions, buying a home.

New American also refers to themselves as the “largest Hispanic-owned mortgage company in the United States.”

And their mission is to increase lending to underserved communities, including Black and Latino borrowers. Let’s find out more about them.

New American Funding Fast Facts

• Retail direct-to-consumer mortgage company with 180 branches nationwide
• Launched in 2003, headquartered in Tustin, California (Orange County)
• Started by husband and wife team Rick and Patty Arvielo
• Originally a 40-employee call center, workforce now close to 5,000
• Offers home purchase financing and refinance loans
• Licensed to do business in all states except Hawaii
• Funded more than $14 billion in home loans during 2022 (nearly a top-25 lender nationally)
• Services more than 200,000 loans worth approximately $54 billion
• Ranked #1 loan servicer by J.D. Power in the 2022 study

New American Funding got started back in 2003, which was around the time the housing market was booming.

Just a few short years later, the subprime mortgage crisis hit, and hundreds of lenders didn’t survive.

So I suppose that’s a testament to the resolve of New American Funding, which is a DBA of parent company Broker Solutions, Inc.

Despite being a young company at the time, they were able to get through the Great Recession and become a mortgage powerhouse just a decade later.

As noted, they are a family company, with husband and wife team Rick and Patty Arvielo the founders. Rick is currently CEO, while Patty is the president.

The direct lender is based out of Tustin, California, which is in the heart of Orange County, home to scores of mortgage lenders and related real estate companies.

The pair grew New American Funding from a 40-employee call center into one of the largest mortgage lenders in the country in less than 20 years.

Today, they count 4,700 individuals as employees, have nearly 200 branches nationwide, and maintain a loan servicing portfolio consisting of over 200,000 loans worth about $54 billion.

Last year, the company funded more than $14 billion in home loans, which puts them very close to the top-25 mortgage lenders nationally.

Roughly two-thirds of their business consisted of home purchase loans, with the remainder refinance loans.

In February 2024, New American Funding acquired Chicago-based Draper and Kramer Mortgage Corp. to expand their reach into the Midwest.

Note: They do not lend in the state of Hawaii at this time.

New American Is the #1 Hispanic Mortgage Lender

As noted, New American is on a mission to increase homeownership for underserved communities, especially Black and Latino borrowers.

Last year, 36% of their home purchase loans went to minority borrowers, compared to just 25.5% for all lending institutions, based on 2020 HMDA data.

They are also the #1 lender to Hispanic borrowers, with a larger percentage of their loans going to Hispanic borrowers versus any other lender in the top-25.

Additionally, their share of purchase lending to Black borrowers was 85% higher than the industry average, a result of their “New American Dream” initiative launched in 2016.

They are also committed to lending $25 billion in new mortgages to Hispanic borrowers by the year 2024, and $20 billion to Black borrowers over the next seven years.

When it comes to diversity at the company itself, 23% of the company’s workforce is Hispanic, 45% of the company’s employees are minorities, and 60% are women.

What Loan Types Does New American Funding Offer?

• Home purchase financing
• Home renovation loans
• Refinance loans: rate and term refi, cash out refi, and streamline refis
• Conventional loans: Conforming and jumbo
• Government loans: FHA, VA, and USDA loans
• ARMs: 5/1, 7/1, 10/1 varieties
• Fixed mortgages: 30-year and 15-year options
• Choose your own term mortgages
• Renovation loans and Energy Efficient loans
• Non-QM loans (self-employed borrowers)
• Interest-only mortgages
• HELOCs
• Buydown Loans (such as a 3-2-1- buydown)

One great thing about New American Funding is that you can get pretty much any type of home loan under the sun.

This includes home purchase loans, home renovation loans, rate and term refinances, cash out refinances, and streamline refinances.

They are a Fannie Mae, Freddie Mac, and Ginnie Mae direct lender, seller, and servicer, so they’ve got all the conforming and government loan options you can think of.

That includes the usual suspects like conforming mortgages, FHA loans, USDA loans, and VA loans. But that’s not all.

They also offer interest-only mortgages, jumbo loans, non-QM loans, reverse mortgages, and some proprietary offerings like the “I CAN Mortgage.”

So what is an I CAN Mortgage you ask? Well, it’s simply a choose your own term mortgage, that allows for custom terms ranging from 8 to 30 Years.

For example, if you’re 7 years into a 30-year fixed and want to refinance your mortgage to take advantage of today’s low mortgage rates, you could go with a 23-year term instead of restarting the clock.

This also works for new purchases, so you can just start with a 24-year fixed instead of the standard 30-year fixed to save some dough and own more of your home sooner.

Their so-called Self Employed Mortgage, which may be considered non-QM, allows for the use of bank statements, asset depletion, or just one-year of tax returns to qualify.

They also offer HELOCs, including fixed-rate, adjustable, and hybrid options for those looking to tap equity, along with renovation loans such as the FHA 203k refinance loan and Fannie Mae Homestyle.

New American also operates both a builder and real estate lending division, so they may be a good fit for someone buying a brand-new home or building a home (new construction).

Lastly, they offer Energy Efficient Loans for those looking to finance a home that is already energy-efficient or to make an existing property simply greener.

Pathway to Homeownership Initiative

In February 2023, NAF launched its “Pathway to Homeownership” initiative to help customers purchase their first home in designated areas throughout the country.

It provides up to $8,000 in assistance that can be used for down payment or other closing costs. And best of all it doesn’t need to be paid back.

There are no income limitations, and it can be combined with other down payment assistance programs.

To qualify for Pathway, you must be a first-time home buyer with a minimum credit score of 620. And the property must be a one-unit, single-family home.

Down payments as low as 3% are acceptable. Be sure to inquire with your NAF loan officer to determine if you’re eligible.

NAF also recently partnered with Uqual, “a full-service loan readiness company,” to help prospective home buyers make the leap from renting.

It seeks to turn a loan denial into an approval by improving an applicant’s credit, lowering their debt, and increasing their savings.

Those who complete the loan readiness program and use NAF for their mortgage needs are eligible for a $500 lender credit.

Exclusive Mortgage Provider for Patch

In late February 2023, New American Funding announced that it became the exclusive mortgage provider for “hyper-local news” website Patch.

The partnership will result in NAF placements on the mortgage and real estate hub on each of Patch’s community websites.

And the lender will feature in Patch’s weekly newsletters in over 1,200 communities nationwide.

The link up makes sense because NAF is licensed in all 50 states and has loan officers located throughout the country.

Applying for a Mortgage with New American Funding

• They have a short form you can fill out on their website to get started
• Then a loan officer will call you to go over your loan scenario and options
• You can also call them directly or use their branch/loan officer directory to find someone specific in your area
• Loan process appears to be somewhat digital, allowing for document uploading and loan tracking online

New American Funding a direct-to-consumer retail mortgage lender, meaning you work directly with the company to close your loan.

At one time, they ran a wholesale division, but chose to close it in 2016 to focus on their growing retail operations.

They say you can get pre-approved for a mortgage in as little as 24-48 hours, which is a bit slower than some fully digital lenders that can do the same in minutes, such as Rocket Mortgage or Better Mortgage.

But they do offer the ability to apply online or over the phone. If you get started via the website, you basically fill out what amounts to be a lead form. Then someone will contact you by phone.

You can also look up specific loan officers via the branch directory on their website if you want to ensure you get someone local and highly recommended.

Once your loan is submitted, they offer a digital process that includes uploading necessary loan documentation, along with the ability to track your loan progress online via the borrower portal.

You also get a dedicated loan officer that will help you along the way, which differs from some of the startups that only provide assistance as needed.

New American Funding’s Mortgage Rates

I’m all about transparency, and fortunately New American is too when it comes to their mortgage rates.

They openly advertise them right on their website for all to see. You can check rates daily for the 30-year fixed, 15-year fixed, FHA 30-year fixed, and VA 30-year fixed.

It should be noted that their rate assumptions are very tough, calling for a 740+ FICO score, 60% LTV, primary residence, with up to one discount point on their standard 30-year fixed mortgage.

In other words, if you have a lower credit score, less equity in your home, need cash out, or don’t occupy the property, the interest rate could be substantially higher.

The good news is their advertised rates appear to be quite low, so if you are a good borrower, they might be quite competitive.

As always, take the time to check out the rates of other lenders to ensure you do your due diligence.

In terms of lender fees, it’s unclear if they charge a loan origination fee or separate fees for underwriting and processing. Be sure to inquire when speaking with your loan officer.

New American Funding 14 Business Day Close Guarantee

If you happen to be buying a home, the company has a “14 Business Day Close Guarantee” to ensure you get to the finish line quickly, especially in a competitive market.

They say they have industry leading turn times because they’re an “all-inclusive mortgage banker.”

Their operations staff, including loan underwriters, doc drawers and funders, work under one roof, enabling them to close loans fast.

They offer 24-hour credit approval by senior underwriters and 24-hour underwriting turn times on conditions.

The 14-day window begins when your initial application package is complete and you have authorized credit card payment for your home appraisal.

If they fail to perform as agreed, a credit of $250 will be applied toward closing costs. While it’s not much money, the fact that they can close purchase loans in just two weeks is pretty attractive.

New American Funding and EasyKnock

In late January 2023, New American Funding and EasyKnock announced partnership “to offer innovative solutions to underserved communities.”

It’s unclear exactly what those solutions are, but my assumption is that the lender will offer home loan programs to EasyKnock customers.

These will allow borrowers ” to access their home equity through credible and non-traditional means,” which in turn helps keep them in their local communities and schools.

This tells me it might be a home equity product, such as a HELOC.

The company allows homeowners to sell to EasyKnock but remain in the properties as renters.

New American Funding Reviews

New American has a 4.87-star rating out of 5 on Experience.com from around 180,000 reviews.

Yes, nearly 200,000 customer reviews and a near-perfect rating. That’s truly impressive.

They also have a 4.91-star rating out of a possible 5 on Zillow from 8,500+ customer reviews.

Many of their reviews on Zillow indicate a lower interest rate and/or lower closing costs than expected.

Similarly, they have a 4.9/5 rating on LendingTree from nearly 60,000 reviews, with 99% of customers saying they’d recommend them to others.

Lastly, the company boasts an A+ Better Business Bureau rating and has been accredited since 2004.

So they appear to be very well-liked, though experiences can always vary based on individual circumstances, especially at a large company.

Tip: You can view the ratings of specific loan officers near you if you go the branches tab on their website, select a location, then scroll down to “Meet the Team.”

This allows you to see the staff who work in a particular office, along with their individual ratings as loan officers.

If you like what you see, you can apply for a home loan directly with that individual, or simply get in touch if you have questions.

Pros and Cons of New American Funding

The Good:

• Offer virtually every home loan type imaginable including reverse mortgages and HELOCs
• Can select your loan officer from an online directory and/or visit a physical branch
• Direct lender, seller, and loan servicer with quick turn times and fast closings
• Appear to offer competitive mortgage rates
• Excellent customer reviews across all ratings websites
• A+ BBB rating, accredited company since 2004
• 14 Business Day Close Guarantee for home purchase loans
• Can manage your funded loan with the New American Funding My Mortgage App
• They service their own loans instead of transferring them
• Free mortgage calculators, mortgage glossary, and market update on their website

Potential Bad:

• You must speak to a loan officer before you can apply
• Not available in Hawaii

New American Funding vs. AmeriSave

(photo: Cristian Ramírez)