Everything You Need to Know About Costco Mortgage Services
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Costco is well-known for being one of the largest retailers in the United States. The company operates a subscription-based business model that allows customers to purchase goods at wholesale prices in its warehouse-style stores. In recent years, Costco has expanded its services to include home mortgages.
Costco Mortgage Services provides a range of loan products to customers throughout the United States. While Costco is not the direct lender, it places its clients into partnerships with some of the nation’s largest mortgage providers. It is currently headquartered in the state of Washington.
Our Review of Costco Mortgages
Costco Mortgage Services provides home loans to customers throughout various parts of the United States, partnering with First Choice Loan Services to facilitate the loans. Nonetheless, First Choice is not the only lender. Indeed, there is a wide array of lenders that one can choose from.
While you don’t have to be a Costco member to take advantage of the company’s loan platform, a membership can save you a substantial amount on fees.
So, should you head to Costco Mortgage Services next time you’re ready to purchase a house? Let’s find out by exploring the critical elements of this retail giant’s home loan platform.
Costco’s Mortgage Process
If you want to apply for a loan, you can head to the Costco Mortgage Services website and begin the application. Once you select what type of loan you wish to apply for, a portal will appear on the left-hand side of the main page. Here you can enter your details and compare rates from multiple lenders.
Once you decide which rates you prefer, you can select up to four lenders and have them send you quotes. The lenders will use the contact information you have already provided. Unfortunately, this is not a platform that allows you to complete your entire application online.
You will need to have your credit score ready (and a few other key details) to take advantage of this application portal. Alternatively, you’re welcome to call Costco Mortgage Services to discuss the loan application.
Costco’s Pros & Cons
Looking at a concise list of pros and cons can help you better assess the strength of a lender. Below, let’s explore the strengths and weaknesses of Costco Mortgage Services:
What States Does Costco Offer Mortgage Services?
Unlike other lenders, Costco Mortgage Services connects you with multiple mortgage providers. This means that each lender will have different licenses and geographical restrictions. Fortunately, there are lenders on Costco Mortgage Services’ list that are eligible in all 50 states. So you won’t have to worry about being unable to use this platform.
Costco’s Available Mortgage Types & Programs
At Costco Mortgage Services, you have plenty of choices when it comes to mortgage products. Because the service is actually a marketplace for multiple lenders, you benefit from all the different mortgage products offered by the platform’s third-party lending partners. Clients have access to conventional loans, jumbo loans, fixed-rate loans, variable-rate loans, FHA loans, USDA loans, and VA loans.
In addition to these mortgage products, property owners are also welcome to access home refinancing loans on the Costco Mortgage Services platform.Have a house to sell before moving? Read our guide here. (March 31, 2020)
Costco’s Mortgage Fees & Rates
The rates that you pay will depend on your credit history and the lender that you partner with. Fortunately, you will find that many of the lenders offer interest rates below 4% if you have a solid credit history. It only takes a few clicks of your mouse to see some quotes in your area, so make sure to use the Costco application portal to check the latest rates.
In terms of origination fees, Costco members have their fees capped: $350 for Executive Costco and $650 for Gold Start Costco. Considering that some lenders charge more than 1% of the total value of the loan, this is a huge bonus. It might even be worth signing up for a membership to take advantage of this offer, depending on how much the origination fee will be.
Costco’s Customer Service
If you obtain a mortgage through Costco Mortgage Services, you might need to get in touch with the company’s customer support team. Fortunately, you can use an online contact form or call their customer service office directly.
For those who prefer to call, you can reach them from 9 AM to 9 PM (EST) on weekdays, and 12 PM to 4 PM (EST) on Saturdays. They are not available on Sundays.
Costco’s Borrower Qualifications & Requirements
As Costco Mortgage Services is a mortgage marketplace, it doesn’t set the standards for borrower qualifications. In most cases, lenders will want a 620-credit score (or higher) to consider you for a conventional loan.
On the other hand, if you’re looking for a government-backed loan (VA, USDA, or FHA), you might be able to get away with having a lower credit score.
Still, make sure to speak with your partner lender to ensure that you’re eligible for the type of loan that interests you. If you apply for a loan you’re not eligible for, it can damage your credit score when you get rejected.
Costco’s Online Reputation
It’s wise to avoid any lender that has a bad reputation with previous borrowers. No matter what interest rates a lender offers you, make sure you listen to the experiences of previous customers. Many lenders will try and charge you sneaky fees or perhaps they provide horrible customer service. If so, you will want to stay away, no matter how good their numbers may look.
We checked with various consumer watchdog groups to find out if Costco had a solid reputation with its client base. The overwhelming majority of reviews were quite positive. While there were some negative comments, it’s safe to say that this is a credible and well-regarded lender.
More From ISoldMyHouse.com: Be sure to check out our other mortgage company reviews!
About the Author: Kris Lippi is the owner of ISoldMyHouse.com and the broker of Get LISTED Realty. He actively writes about real estate related topics such as buying and selling homes, how-to guides for around the house and home product recommendations. He has been featured in Inman, Readers Digest, American Express, Fit Small Business, Policy Genius, Lending Tree, GoDaddy, Manta as well as other major websites. Read more about us here.