Business Insider's personal finance team compared Watermark Home Loans to the best mortgage lenders and found it to be a standard lender.
Watermark Home Loans Mortgages may be a good choice for borrowers who have financial situations that might prevent them from qualifying for a conforming mortgage. It offers mortgages for those who have a recent bankruptcy or foreclosure on their credit report, those with high debt-to-income ratios, and self-employed borrowers. But the lender lacks transparency around its rates and fees.
620
3%
Conforming, jumbo, FHA, VA, USDA, reverse mortgages, non-QM
- Easy digital experience
- Remote closing option
- Offers loans for those with recent bankruptcies or foreclosures
- No way to see rates without providing contact information
- Doesn't disclose lender fees
- Not available in Alaska, Missouri, New York, Rhode Island, or Vermont
- Available in 45 states and Washington, DC
- Offers jumbo loan amounts up to $5 million
- Minimum credit score and down payment displayed are for conforming mortgages.
Overview of Watermark Home Loans
Watermark Home Loans is an online mortgage lender headquartered in Irvine, California. It lends in 45 states and Washington, D.C. If you're buying a home in Alaska, Missouri, New York, Rhode Island, or Vermont, you won't be able to get a mortgage with this lender.
Watermark Home Loans Mortgage Options
Conventional Loans
Watermark Home Loans offers conforming loans, a type of conventional loan and the most popular mortgage product among borrowers.
Jumbo Loans
Watermark also offers jumbo loans for borrowers who need a mortgage that exceeds the conforming loan limit. Its jumbo loans are available in amounts up to $5 million.
To qualify for a jumbo loan from this lender, you'll need a 10% down payment.
FHA Loans
Watermark says that credit scores below 620 "may be accepted" on its FHA loans. Typically, FHA loans allow scores down to 580 with a 3.5% down payment, or 500 with 10% down. But requirements vary by lender.
VA Loans
Watermark Home Loans offers VA loans for eligible borrowers who meet minimum service requirements.
USDA Loans
You may qualify for a USDA loan from Watermark if you have a low-to-moderate income and live in an eligible rural or suburban area.
Non-QM Loans
For borrowers who don't qualify for a traditional mortgage, Watermark offers non-QM loans.
Non-QM loans can be beneficial for those who have the ability to repay a mortgage but don't qualify with the standard mortgage underwriting process.
Watermark's non-QM options are geared toward borrowers who:
- Have a recent bankruptcy or foreclosure on their credit report
- Have a high DTI
- Are self-employed and want to use their bank statements as proof of income
It also has interest-only mortgage options.
Reverse Mortgages
This lender also has reverse mortgages for older adults who want to tap into their home's equity.
How to Apply
Watermark offers a completely online mortgage experience, and you can start an application on its website. You may also apply over the phone if you prefer.
Watermark Home Loans Mortgage Interest Rates and Fees
Average rates and fees
According to Business Insider's review of Home Mortgage Disclosure Act data, Watermark's mortgage rates are around average compared to other lenders.
To learn more about the rates Watermark offers, you'll need to fill out a form on its website and provide contact information.
In 2023, the average borrower getting a conventional loan from Watermark Home Loans paid $4,180 in origination charges, according to HMDA data. This is around average compared to other lenders.
Watermark Home Loans Pros and Cons
Pros
- Easily upload documents and view loan information with Watermark's Loan Hub
- Completely digital experience lets you close remotely
- Has mortgages for borrowers with recent negative credit events and other unique situations
This lender offers a convenient online application and remote closings, making the process simple from start to finish. If you're looking for a digital-friendly lender, you might like Watermark.
It's also a good choice for borrowers in need of a non-QM loan.
Cons
- You'll need to provide contact information to see rates
- Lender rates and fees aren't disclosed on its site
- Doesn't lend in Alaska, Missouri, New York, Rhode Island, or Vermont
Watermark Home Loans lacks transparency when it comes to its rates and fees. We did find that its rates and fees are around average, according to HMDA data. But if you're looking to explore the lender's current rates, you'll need to provide your name, phone number, and email.
Is Watermark Home Loans Trustworthy?
Overall, we think Watermark Home Loans is a trustworthy lender. It has an A+ rating from the Better Business Bureau and no recent major scandals.
What Borrowers Are Saying About Watermark Home Loans
Business Insider looked at positive and negative customer reviews, online forums, BBB complaints, and other sources to understand what borrowers think about Watermark Home Loans.
Customer Feedback on Watermark's Service
We saw many reviews and comments from previous borrowers that mentioned Watermark's great customer service and helpful loan officers.
We also saw a handful of reviews describing a bumpy process with poor communication. But compared to the large amount of positive reviews, we don't think this is indicative of a larger problem with the lender.
Compare Watermark to Competitors
Watermark Home Loans vs. New American Funding
New American Funding and Watermark are both good lenders for borrowers with unique financial situations.
While Watermark has mortgage options for those with recent dings on their credit and high debt-to-income (DTI) ratios, New American Funding has options that let borrowers with no credit history use non-traditional credit to qualify. Non-traditional credit can include things like providing your rent payment history to show you have a good track record of making on-time payments.
New American Funding has a few more options than Watermark Home Loans, including its I CAN mortgage which lets you choose any loan term between eight and 30 years.
New American Funding is also featured in Business Insider's guide to the best low credit score mortgage lenders.
Watermark Home Loans vs. NBKC Bank
If an easy online experience is important to you, NBKC Bank and Watermark are both solid options. For those who want the ability to easily explore rates, NBKC Bank lets you get customized quotes commitment-free using its online rate calculator.
But if you have a unique financial situation, Watermark's non-QM options would likely better suit your needs.
Watermark Home Loans FAQs
Watermark Home Loans is a mortgage lender. Lenders differ from mortgage brokers in that brokers help you compare offers from a variety of lenders. They do the legwork of shopping around and pulling together information from multiple lenders. Brokers don't lend mortgages; for that, you'll work with a lender.
Watermark Home Loans is a completely online lender. Its headquarters are located in Irvine, California.
Yes, Watermark Home Loans is a real lender with positive online customer reviews and an A+ rating from the BBB.
Watermark offers a variety of different conventional and government-backed mortgages, including traditional mortgages, reverse mortgages, and non-QM loans.
Watermark Home Loans offers an easy online application that you can complete from your computer or mobile phone.
Watermark Home Loans offers average mortgage rates, according to HMDA data.
Why You Should Trust Us: How We Reviewed Watermark Home Loans
For our review of Watermark Home Loans, we used our methodology for reviewing mortgage lenders.
We look at four factors — loan types, affordability, customer satisfaction, and trustworthiness — and give each a rating between 1 and 5, then we average these individual ratings for the overall lender rating. Lenders get higher ratings if they offer a large number of loan types with affordable features, have positive customer reviews, and don't have any recent public controversies.
Our Overall Lender Rating
Loan Types: 4 out of 5
Watermark offers a good range of loan types that will meet most borrowers' needs. But it doesn't have home equity loans or HELOCs.
Affordability: 4 out of 5
We think Watermark is an overall affordable mortgage lender thanks to its strong government-backed loan offerings and non-QM options.
Customer Satisfaction: 4.84 out of 5
Watermark has very positive customer reviews on its Zillow profile, with an average rating of 4.84 out of 5 stars, based on over 1,000 online customer reviews.
Trustworthiness: 5 out of 5
Watermark Home Loans has an A+ rating frmo the BBB. BBB grades are based on a company's honesty in advertising, transparency about its business practices, and effectiveness in responding to customer complaints.
