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Over the past decade, loanDepot has quietly grown into one of the largest mortgage lenders in the U.S., underwriting $42 billion in home loans during 2019 — the Consumer Financial Protection Bureau hasn’t released 2020 figures yet. If you need to buy, refinance or renovate a home, loanDepot offers a wide variety of loan products. While it excels as an online lender, loanDepot also has about 200 physical locations across the U.S. It calls these branches loan stores.

This article will dig into the details of this unique lender.

Table of contents:

  • About loanDepot
  • Mortgage options
  • Mortgage qualifications
  • Rates and fees
  • Customer satisfaction
  • Pros and cons

About loanDepot

loanDepot’s founder, Anthony Hsieh, is an online lending pioneer. He started, the first online lender available in all 50 states, in 2002. This venture eventually merged with LendingTree. Prior to that, in 1989, he started, which E*TRADE eventually bought. Hsieh launched loanDepot (NMLS ID# 174457) in 2010 and — despite recent talk about an initial public offering (IPO) — he continues to own and operate this Foothill Ranch, California-based lender.

Originally, loanDepot used traditional underwriting for most of its loan options, but it developed an automated application process that uses technology to streamline the mortgage approval process. loanDepot calls this process Mello Smartloan.

What does all this mean to you, the home buyer? It means you can get your mortgage loan approved faster and with less hassle, especially if you apply online.

Mortgage options

loanDepot offers conventional loans and subsidized loans through the Federal Housing Administration (FHA) and the Department of Veterans Affairs (VA).

Fixed-rate mortgages

loanDepot offers 10-, 15-, 20- and 30-year terms on fixed-rate, conventional loans. Most conventional loans require a down payment of at least 3%, but a low credit score could limit your options. You can lock in your rate so it’ll remain the same over the term of the loan.

Adjustable-rate mortgages

loanDepot's adjustable-rate loans come with a locked-in rate for 3, 5, 7 or 10 years. After that period, the rate will fluctuate each year according to the market.

Jumbo loans

These loans exceed the Freddie Mac and Fannie Mae limits for conventional loans. In most markets, borrowing more than $726,200 requires a jumbo loan — conventional loans that have higher limits in some of the most expensive markets.

FHA loans

Backing from the federal government helps loanDepot extend credit to home shoppers with lower credit scores, but there are no income limits, so anyone can use this borrowing program. The FHA requires a down payment of at least 3.5%, and mortgage insurance premiums last over the term of the loan unless you put down a deposit of 10%.

FHA 203k loans

This special FHA loan program works well when you’re buying a fixer-upper. It includes money to buy the home and additional money to renovate it. The eventual value of your home once renovations are complete determines the underwriting decision. You’ll require some extra paperwork to show that you're working with a qualified contractor with a calculated budget appropriate for your renovation project. Not all lenders offer this renovation loan program.

VA loans

Veterans, active-duty military members and certain surviving spouses of veterans can buy a home with no down payment through the VA loan program. VA loans don't require continuing mortgage insurance, and they can extend great rates to borrowers.

Cash-out refinance

With this loan, you can replace your existing home loan with a new loan while simultaneously taking out cash for renovations, debt consolidation or other expenses. In addition to making a home purchase, you can refinance your existing loan into a lower rate, shorter term or both using an FHA, VA or conventional loan.

What's missing from loanDepot's product line?

Borrowers won't find United States Department of Agriculture (USDA) loans in loanDepot's product line. This type of loan can sometimes allow rural home buyers to take out mortgages with no down payment. A lot of lenders have USDA loans, however, so you shouldn't have trouble finding one.

You also won't find home equity loans or home equity lines of credit (HELOC) at loanDepot. These second mortgages are common loan products at banks, credit unions and other traditional lenders. They’re great for financing home improvements or using your equity to pay off higher-interest debt. once offered personal loans, such as debt consolidation loans, with no collateral, but it now sticks to secured mortgages.

Mortgage qualifications

Most home loans require a minimum credit score of 620, but home financing is not an exact science. Lenders will consider a variety of factors, including your debt-to-income ratio (DTI). With loanDepot or any other lender, you'll have access to the best interest rates when you apply with a higher credit score.

This blog is full of resources to help you if you need to work on your credit score before applying for a loan. You should know your credit score before you start shopping for a mortgage.

When you see generic quotes on a website such as loanDepot's, these rates assume you have a credit score of 740 and a DTI of 35% or lower. Unless you qualify for a VA loan that offers no down payment options, expect to put down a deposit of at least 3% on your home purchase. More credit-challenged applicants may have to make higher down payments.

Rates and fees

As a private company, loanDepot doesn't have to publish its origination fees or its interest rates. Currently, it doesn’t share this information, so you’ll have to check with your loan officer before finalizing your loan. Other sites refer to loanDepot loan origination fees of 5%, but a fee this high would far exceed the industry average of 0.5% to 1%, and it’s unlikely that loanDepot would charge a fee this high.

On VA loans, the Department of Veterans Affairs rules state that the origination fee can't exceed 1% of the loan amount. In addition, homeowners who buy a home through loanDepot get a lifetime guarantee that they won't have to pay loan origination fees again if they refinance the home through loanDepot. The lender also waives or reimburses appraisal fees on your refinance loan.

That said, you should never pay a loan origination fee of 5%, which is exorbitant by industry standards. A 1% fee on a $250,000 loan would cost $2,500. On that same loan amount, a 5% fee would equal $12,500. That amount of money should cover — or come close to covering — all your closing costs.

If you get a quote from loanDepot, make sure you compare their lending fee against those of other mortgage lenders. There's a huge focus on interest rates when you shop for a mortgage, but don't forget to discuss the lender fees with your loan officer before agreeing to an offer.

Customer satisfaction

Across its line of mortgage products, loanDepot records high customer satisfaction scores. The 2020 JD Power customer satisfaction survey awarded loanDepot 844 out of 1,000 possible points — 12 points lower than the industry average — for loan originations. Only three lenders scored higher than the industry average: Chase, Bank of America and Quicken Loans/Rocket Mortgage.

For loan servicing, loanDepot didn't fare as well, but few lenders do due to the fact that servicing is a long-term relationship that offers more opportunity for complaints. For servicing, loanDepot scored 753 out of 1,000, about 28 points lower than the industry average of 781. These JD Power surveys are good guidelines because they reflect many customer experiences. But keep in mind that your experience may be different.

As a loan servicer, loanDepot has ways to help borrowers catch up on late payments and enter forbearance if necessary. The key here is to be proactive: Get in touch with the customer service department as soon as you have a problem making payments. Waiting too long can limit your options.

Like most loan servicers, loanDepot worked with account holders during the COVID-19 pandemic to help them stay in their homes despite the financial challenges.

loanDepot Mortgage pros and cons

loanDepot has a lot to offer, but there’s no such thing as a perfect lender. The following is a summary of the advantages and disadvantages of loanDepot:


  • Online loan process and loan servicing
  • Wide variety of conventional and subsidized loans
  • Branches available in many states
  • High customer satisfaction ratings
  • Backing from an experienced mortgage lending team
  • Lifetime guarantee that covers future refinancing fees with loanDepot


  • Unclear lending fees and rates: Check yours carefully before finalizing your loan.
  • No USDA loans available
  • No second mortgage loans, such as HELOCs or home equity loans
  • Not always ideal for lower credit score borrowers
  • No rate quotes available unless you start a loan application
  • Not ideal for complex mortgage applications

Is a loanDepot mortgage right for you?

With hundreds of home purchase and refinance lenders out there, you can find a good fit, especially if you have a credit score higher than 620 and a DTI below 43%. loanDepot is a legitimate lender, and it’s a particularly good fit for online borrowers who want a renovation loan, such as the FHA 203k. Customers who need a fast turnaround on a simple loan application will also like loanDepot, but if you're shopping for a second mortgage or a USDA loan, you'll need to look elsewhere.

Disclaimer: This story was originally published on November 25, 2019, on To find the most relevant information concerning loanDepot, please visit their website: