Today we’ll take a deep dive into a major credit union that’s also a sizable mortgage lender, Pentagon Federal Credit Union, or PenFed for short.
While originally intended to serve the U.S. military, veterans, and various defense department government employees, today anyone can join PenFed, whether part of those groups or not.
For example, if you have no military affiliation whatsoever, it’s possible to join if your employer is eligible or if you make a small donation to an organization.
PenFed has been around since 1935, and today serves more than two million members worldwide with a whopping $25 billion in assets.
They lend in all 50 states and the District of Columbia, as well as in Guam, Puerto Rico, and Okinawa. Let’s learn more.
PenFed Mortgage Fast Facts
- Members-only credit union federally insured by NCUA
- Founded in 1935, headquartered in Alexandria, Virginia
- Anyone free to join regardless of lack of military background
- Offer checking and savings accounts, credit cards, mortgages, and HELOCs
- Licensed to lend in all 50 states, D.C., Guam, Puerto Rico, and Okinawa
- Funded $1.6 billion in home loans last year (2024)
- Did about a fifth of total loan volume in home state or Virginia
- Also operate a wholly-owned title insurance company called PenFed Title, LLC
- And a real estate brokerage called PenFed Realty
As noted, anyone can join PenFed, though they are a members-only credit union. So once you become a member, you can take advantage of their many product offerings, including home mortgages.
This differs from Navy Federal CU, which doesn’t allow civilians to join.
Last year, the Alexandria, VA-based credit union did roughly $1.6 billion in total home loan origination volume, with about 11% of it in its home state of Virginia.
A good chunk was also originated in the nearby states of Maryland and North Carolina, along with Florida, Texas, and even faraway California.
In past boom years they funded nearly $20 billion annually, so loan volume has dropped off quite a bit. But Penfed is still a major player in the mortgage space.
Home purchase loans accounted for roughly 72% of volume, with the remainder rate and term refinances, cash out refinances, and HELOCs.
And while most of their home loans were fixed-rate mortgages, they offer a variety of adjustable-rate mortgages as well.
PenFed Very Important Buyer (VIB) Program
Similar to some other large mortgage companies, like Rocket Mortgage and Redfin, PenFed has a real estate division called PenFed Realty, which is backed by Berkshire Hathaway HomeServices.
It’s basically a real estate agent referral network that pairs agents with prospective home buyers nationwide.
PenFed members who use both PenFed Mortgage and an agent from the PenFed real estate network agent are considered “Very Important Buyers” (VIBs).
As such, they receive lender-paid closing credit with an average value of $2,300 and the ability to refinance the loan again within three years with no lender fees (no cost refinance).
If you don’t already have a real estate agent, but want to use PenFed for your mortgage, it’s an option to save some dough.
How to Apply for a Home Loan with PenFed Mortgage
- Members can submit their loan application directly from their account on PenFed Online
- They ask that you call them or submit a call back request online if refinancing or inquiring about a HELOC
- Those looking to generate a pre-approval can do so right away via the online portal
- They offer a digital mortgage loan experience that allows you to complete most tasks electronically
Assuming you’re a PenFed member, it’s possible to get the ball rolling simply by calling them up directly or by filling out a short call back request form on their website.
If you’re looking for a mortgage pre-approval for a home purchase, you can also begin on your own via the PenFed online portal.
Like many other banks and lenders, PenFed offers a digital mortgage experience where you can eSign disclosures, scan and upload documents, receive real-time status updates, and check loan progress 24/7.
PenFed also operates its own title insurance company, which might speed up the loan process and/or result in discounts on such services.
One nice thing about PenFed is that they provide full upfront loan approvals that include a full underwriting review and credit check to ensure you actually qualify.
This can give you a leg up with the home seller over other buyers if you get into a bidding war.
Loan Programs Available at PenFed Mortgage
- Home purchase loans
- Refinance loans (rate and term and cash out)
- Conventional loans backed by Fannie Mae and Freddie Mac
- Jumbo loans up to $3 million loan amounts
- FHA loans
- VA loans for eligible military and veterans
- Home equity lines of credit (HELOCs)
- Various fixed-rate and adjustable-rate options available
PenFed offers both home purchase financing and refinance loans on a variety of property types, including single-family homes and condos/townhomes, along with multi-unit properties.
It’s possible to finance a primary residence, second home, or investment property using a conventional loan backed by Fannie Mae and Freddie Mac, or a jumbo home loan that exceeds the conforming loan limit.
They also specialize in VA loans seeing that they were originally geared specifically toward military and veterans. And recently began offering FHA loans as well!
While they don’t offer USDA loans, which is a major downside for some borrowers in rural areas, they do offer a home equity line of credit (HELOC) product, with the possibility to tap equity up to 90% CLTV.
PenFed pays most of the closing costs on the HELOC, and will waive the $99 annual fee if $99 in interest is paid during the preceding 12-month period.
The only caveat on that product is if you pay it off or close it within 36 months you’ll need to reimburse the full amount of the PenFed-paid closing costs for the loan.
PenFed also offers some unique proprietary loan programs like their 15/15 ARM or their 5/5 ARM if you’re looking for something a little different.
And they offer traditional ARMs like the 5/6 ARM and 7/6 ARM, along with the usual fixed-rate options like a 30-year and 15-year fixed.
PenFed Mortgage Rates
One nice thing about PenFed is the fact that they openly advertise their mortgage rates for all to see on their website.
You don’t need to sign in to see their rates – simply surf over to their site to see today’s rates on a variety of products including conventional fixed-rate loans, jumbo fixed-rate loans, and VA loans.
They don’t advertise their ARM rates so you’ll either need to click on “Get My Rate” to generate your own mortgage rate quote on their website or call in for pricing if you want an adjustable-rate mortgage.
From what I saw, their mortgage rates were competitive, especially since they say they don’t charge lender fees.
Additionally, those purchasing a home may be eligible for a lender credit ranging from $500 to $2,500 depending on loan amount, which can be used to offset any third-party closing costs like the home appraisal or title insurance.
All in all, PenFed’s mortgage rates seem competitive and the lack of lender fees makes them even more desirable when you consider the mortgage APR.
PenFed Mortgage Reviews
They have a rather marginal 4.62-star rating out of 5 on Zillow, though it’s only based on about 100 customer reviews. I say that because most mortgage lenders are Zillow score higher.
Similarly, they have a 4.0-star rating out of 5 on WalletHub from a much larger sample size of about 12,000 reviews, but that may include non-mortgage related products.
However, quite a few seem to focus on their mortgage or home equity products, so you’ll be able to read about relevant customer experiences if you’re applying for a home loan.
It’s the same story over at Trustpilot, a 3.8-star rating from 1,900+ reviews. Again, seems to be consistent with other ratings sites that they’re not quite there customer service-wise.
While they aren’t a Better Business Bureau accredited company, they do currently have an ‘A+’ BBB rating based on complaint history.
But their customer reviews on the BBB website are rather poor, with a 1.18-star rating on 200+ reviews at last glance.
So it seems they’re struggling a bit in the customer satisfaction department, despite having a solid website, competitive mortgage rates, and no lender fees.
To sum it up, if they’re able to beat other lenders on rate and fee, they could definitely be worth considering for both a home purchase or refinance.
They’ve got a digital loan process and some unique loan programs the other guys don’t. The downside is you might have to work remotely as their branch network is limited if you don’t live near a base.
PenFed Mortgage Pros and Cons
The Good
- They openly advertise their mortgage rates which appear to be competitive
- Don’t charge lender fees
- Lender credit specials on home purchase loans
- Can apply for a mortgage online via digital process
- Offer lots of home loan programs including home equity products
- Jumbo loan amounts as high as $3 million
- Free mortgage calculators on their website
- They service their home loans
- No lender-fee refinance if you use them again within 3 years
The Maybe Not
- Limited number of branches if you don’t live by a base
- Do not offer USDA loans
- Mediocre reviews from past customers
(photo: Wiyre Media)
- Why Mortgage Rates Went Up This Time - October 30, 2025
- Mortgage Rates Tend to Go the Opposite Way of the Fed on Fed Day - October 29, 2025
- Soon You’ll Be Able to Pay the Mortgage with Venmo - October 28, 2025
I am a PenFed member. What benefits are available for people selling their home? Any price reductions in commissions?
Gayle,
Not sure if they offer any benefits to home sellers, but they do offer lender credits to members who take out a home purchase loan.