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PennyMac Mortgage Review: A Top-3 Mortgage Lender Nationally


One of the fastest growing and largest mortgage lenders in the country goes by the name PennyMac, not to be confused with Freddie Mac.

If you’re wondering what the rather odd name means, it stands for Private National Mortgage Acceptance Co.

While the company started as a buyer of distressed mortgage assets after the mortgage crisis in the early 2000s, it wasn’t long before they were originating their own home loans.

Today, they refer to themselves as a “top 3 lender in the U.S.,” which is likely driven by their strong correspondent lending business.

They purchase home loans from small and mid-sized banks, along with credit unions and other smaller mortgage lenders.

But they’re also becoming a major retail mortgage lender as well, serving consumers directly and beginning to make a household name for themselves.

In fact, in October 2019 they broke their one-month record by lending more than $1 billion directly to consumers.

If you’re looking to purchase a home or refinance an existing mortgage, PennyMac might be a lender worth looking into.

PennyMac Mortgage Quick Facts

  • Publicly-traded mortgage company launched in 2008
  • Former Countrywide Financial CFO is their founder
  • A top-3 mortgage lender licensed everywhere but NY
  • Nearly 4,000 employees, headquartered in Westlake Village, CA
  • Funded $125B in home loans during 2021 (6th largest lender nationally)
  • Services more than $368B in home loans for its customers

First a little history on PennyMac, which only stretches back to 2008. But they’ve been busy since.

Back then, they had only 72 employees, however, that total included some major mortgage players, namely former Countrywide Financial CFO and COO Stanford L. Kurland.

This might explain their explosive growth from startup to now one of the largest (if not largest) correspondent mortgage lenders in the country.

They also launched a wholesale mortgage division in 2018 to serve mortgage brokers known as “PennyMac Broker Direct.” It is now known as PennyMac TPO.

So they offer mortgages via the three major channels, including retail, correspondent, and wholesale.

They are also a top-10 residential mortgage servicer with over $368 billion in portfolio, and a publicly-traded company, with two stocks on the NYSE.

How to Apply for a Mortgage with PennyMac

  • Can apply online or by phone or visit a local sales office
  • Loan application powered by Mortgage Access Center (m.a.c)
  • Allows you to check loan status 24/7 and upload key documents
  • Can view your credit scores and access W-2s from your employer via The Work Number verification

I always give props to lenders that let you apply for a mortgage directly on their website. It’s 2020, so if this isn’t an option, and you’re a lender, you better make it one.

With PennyMac, you can apply right away or get pre-approved online by creating an account and filling out a digital loan application.

If you’re old school, or simply need some guidance, you can also enter your contact information on their website and a loan officer will reach out to you to answer questions and get the loan process started.

It’s also possible to simply call them up to get connected with a loan officer to go over mortgage rates and available loan programs.

Those who are just sniffing around can take advantage of PennyMac’s Home Value Estimator tool, which provides its own home price estimate along with Zillow’s Zestimate and price per square foot.

So if you want to more details on what a potential home purchase will cost, or want to know what your current property is valued at, you can do so for free on their website.

Anyway, once you do apply, you can take advantage of their digital loan experience known as m.a.c., short for Mortgage Access Center.

To make the experience quicker and easier, they allow you to import bank statements from your online banking account(s) and verify W-2s via The Work Number.

You’re also able to securely upload documents, access your credit scores, and check loan status 24/7.

As your loan progresses, you’ll receive status notifications and update calls from your dedicated m.a.c team.

Types of Loans Offered by PennyMac

  • Conventional loans: conforming and jumbo loan amounts
  • Government-backed loans: FHA, USDA, and VA loans
  • Home purchase and refinance loans (cash-out is an option)
  • Variety of fixed-rate and adjustable-rate mortgages

Like most lenders, they offer both home purchase loans and refinance loans, in both fixed-rate and adjustable-rate options.

You can get both a conventional loan backed by Fannie Mae or Freddie Mac, or a government-backed loan via the FHA, USDA, or VA.

They offer conforming loans and jumbo loans, so those with expensive properties are good to go.

With regard to loan type, you can get a fixed-rate mortgage with various terms, such as 30-year, 20-year, and 15-year.

Or an adjustable-rate mortgage with an initial fixed-rate period, such as a 3/1, 5/1, 7/1, or 10/1 ARM.

PennyMac also recently rolled out a home equity line of credit (HELOC) product to customers in select states, claiming to be the only major nonbank lender to directly offer one.

They lend on primary residences, second homes, and investment properties, so you’re covered regardless of occupancy type.

PennyMac Mortgage Rates

PennyMac rates

One plus to using PennyMac is that they’re fairly transparent about mortgage rates.

If you go to one of their loan product pages, you’ll see today’s mortgage rates listed. Be sure to view the assumptions and recognize that they’re just sample rates that meet certain criteria.

You can also get a customized quote on their website in about 30 seconds by answering a series of simple borrower- and property-related questions.

While the interest rate may not be set in stone, you can at least get a good idea of how competitive they are relative to other lenders.

Once you get your rate quote, you’ll see several loan options such as the 30-year fixed and 15-year, and possibly some ARMs as well.

They list the interest rate, APR, and mortgage points required for the rate in question.

You can also view additional rates to see what the rate would be with fewer or more discount points.

Assuming you like what you see, you can apply right then and there, which is nice. Or you can call them or have them call you.

All in all, their mortgage rates seem to be competitive from what I saw relative to other lenders, but always take the time to shop around.

PennyMac Better Rate Promise and Close On-Time Promise

PennyMac also makes a lot of promises that they back with real money if they don’t live up to them.

Their “Better Rate Promise” is their promise to beat any competitor’s mortgage rate and/or lender fees.

If they’re unable to do so, and you take your loan elsewhere, they’ll give you a $250 Visa gift card.

Their Close On-Time Promise is their promise to close your home loan on time. If there’s a delay that is their fault and not the borrower’s or a third party, you’ll be sent a $500 Visa gift card.

Both these promises, collectively known as “The PennyMac Promise,” only apply to home purchase loans, not refinances, and there are other various restrictions in the fine print.

PennyMac Mortgage Reviews

PennyMac has more than 19,000 customer reviews on SocialSurvey with a 4.57 out of 5-star rating.

They’ve also got a 4.25 rating out of 5 stars at Zillow based on 173 customer reviews. Many of those reviews indicate the interest rate and closing costs were lower than expected.

Additionally, they are an accredited business with the Better Business Bureau and have an A+ BBB rating.

They’ve got a near-4 star rating based on 421 customer reviews. But they’ve also got a healthy number of customer complaints, with more than 500 at last glance.

So you may want to dig through those if you’re concerned about their customer service.

PennyMac Pros and Cons

The Good Stuff

  • They openly display their mortgage rates
  • You can get a no-obligation quote on their website in seconds
  • Can apply online via digital loan process
  • Offer lots of different loan options for all types of borrowers
  • They service the home loans they originate
  • Free mortgage calculators and home estimate tool
  • Good customer reviews overall
  • Close On-Time Promise
  • Better Rate Promise

The Maybe Bad Stuff

  • Mortgage rates might not be the lowest
  • Lender fees are not listed on their website
  • Be sure to shop around the invoke the Better Rate Promise if necessary
  • Not licensed in New York state
  • Quite a few complaints with the BBB

PennyMac vs. Rocket Mortgage

Rocket Mortgage
Digital application processYesYes
Lender feesVariesVaries
Where are they available?50 states and D.C.50 states and D.C.
Type of lenderDirect lenderDirect lender
Are there physical branches?NoNo
Do they offer FHA loans?YesYes
Do they offer VA loans?YesYes
Do they offer USDA loans?YesNo
Do they offer home equity loans?YesYes
Minimum credit score620580
Will they service my loan?YesYes
Low price guarantee?NoNo
Openly advertise rates?YesYes
Zillow rating4.4/54.48/5
BBB ratingA+A+

2 thoughts on “PennyMac Mortgage Review: A Top-3 Mortgage Lender Nationally”

  1. David Frank Smith

    Stay away from PennyMac.I was in the hospital with covid. Almost died. So I was late with my house payment and Penny Mac was not understanding at all and would not remove negative remarks from my credit report. All of my other creditors helped me out by removing the negative reports on my credit record. I’m a 100% disabled veteran. And unable to get a ADA home, that does not have stairs, because of the remarks from Penny Mac. They are the only negative remarks on my credit record. My score is over 750. They are not understanding at all. Even with proof.

  2. Sorry to hear that brother. They should have offered you a forbearance…. I also had the worst experience with them. PennyMac cost me thousands of dollars by fumbling (with MULTIPLE issues/incidents) the closing of a 5 duplex deal, causing unnecessary delays. Then they screwed up the escrows so bad, their representative took 4 days to figure it out. Then they failed to pay my property taxes on time. While I was out of country, something happened to my insurance and they charged me $189 for “3 weeks of insurance”. If they called me or emailed me I would have gotten the email or my answering service would have emailed me. Salt in the wound. When I called, they just kept talking over me and repeating themselves over and over after I ask them to stop repeating themselves. I don’t recommend anyone ever do business with PennyMac.

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