Navy Federal Credit Union Review

Navy Federal Credit Union Review

With over 8.4 million members all over the nation and assets worth $103.2 billion, Navy Federal Credit Union is the largest credit union in the US. The organization was founded in 1933 and is headquartered in Vienna, Virginia. It offers membership to active military members, Veterans, reservists, family members, and the Department of Defense. Read on for our Navy Federal Credit Union review.

About Navy Federal Credit Union

Navy Federal is a global credit union located in about 30 countries and with over 300 branches located in 30 states. The credit union also has a network of more than 30,000 accessible ATMs.

It offers credit cards, money market accounts, share certificates, checking and savings accounts, individual retirement accounts, home equity loans, student loans, personal loans, and auto loans. It also offers competitive rates for VA home loans without making a downpayment.

To become a member of the credit union, you must be a member of any one of the following armed forces-

  • Army
  • Air Force
  • Navy
  • Marine Corps
  • Space Force
  • Coast Guard
  • National Guard

Family members, including minors, can also become a member of Navy Federal. The services listed above are not available for civilians.

Navy Federal Credit Union might be a good fit for you if:

  • You or your family member is a member of the uniformed forces.
  • You prefer a credit union over a bank to cater to your banking needs.
  • You are in search of bank accounts that help you earn interest.

Navy Federal Credit Union Home Loan Types and Rates

When it comes to mortgages, Navy Federal Credit Union offers several options. You can go for conventional mortgages or even VA home loans, given that you qualify for the mortgage.

Here’s a brief on different types of home loans offered by the Navy Federal Credit Union.

VA Loans

VA home loans are mortgage facilities backed by the US Department of Veterans Affairs (VA) and are provided by VA-approved private lenders. These loans are offered at no downpayment or PMI and are available at highly competitive rates.

To qualify for this loan, you must pass certain eligibility conditions and apply for the VA Certificate of Eligibility (COE). 

Navy Federal Credit Union offers these loans at incredibly lower interest rates and flexible guidelines. Through the credit union, you can avail of the no downpayment option that allows you to borrow the amount without putting absolutely nothing as a downpayment. This can be quite beneficial, especially for a service member who might not have enough funds to make a downpayment.

In addition to this, the credit union allows the seller to contribute up to 4% of the loan amount in terms of closing costs and other related fees. It also offers a refinancing option, allowing you to refinance your loan from them and qualify for even lower rates.

Navy Federal offers a 15-year loan term for a $200,000 mortgage at an interest of 2%, with an APR of 2.631%. If you opt for a 30-year loan term, the rate would be 2.250% with an APR of 2.539%.

Military Choice Loan

The military choice is a type of mortgage offered by Navy Federal to Veterans and active military members who have already used their VA home loan benefits.

Like VA mortgages, these loans also come with no downpayment requirement. This is what sets these loans apart from conventional loans, which require you to make at least a 20% downpayment while borrowing.

Moreover, a conventional loan requires you to either make a 20% downpayment or pay for Private Mortgage Insurance (PMI). In this case, you wouldn’t have to worry about paying either.

In addition to this, this loan has a fixed interest rate and allows seller contribution of up to 6%. The interest rate for a 30-year military choice loan is 3.875%.

Conventional Fixed Rate Loan

If stability is on your mind and having a fixed monthly installment is your priority, you can also apply for the conventional fixed-rate loan by Navy Federal Credit Union.

This loan allows a downpayment of as little as 5% of the total loan amount and does not require you to pay for PMI. Fixed-rate loans add stability to your monthly expenditure and allow you to plan accordingly.

The credit union also allows you to refinance the loan for even lower interest rates. The interest rate for a 15-year long loan is 2% and 2.6% for a 30-year long loan.

Homebuyers Choice Loan

Navy Federal Credit Union’s homebuyers choice loan allows you to purchase the house of your dreams without making a downpayment. It offers features like 100% financing and no PMI requirement, making it extremely easy for service members to purchase their dream home.

Related:NASB Mortgage Review

Under this loan, the seller can make contributions up to 6%.

The rates offered are 4% for a 30-year loan.

Adjustable-Rate Mortgage

Navy Federal Credit Union also offers a 5/5 adjustable-rate mortgage. Under this, the interest rate remains constant for the first five years. After five years, the rate shifts to an adjustable-rate for the coming five years.

This is an excellent option if you are not planning to stay in the house for more than five years, as the initial rate would be competitively lower compared to a fixed-rate loan.

The mortgage comes with additional perks like no PMI requirement and a refinancing option. The rate offered for 5/5 confirming ARM is 2.125%.

Pros and Cons of Navy Federal Credit Union Home Loan

With its agenda of providing you with peace of mind, Navy Federal Credit Union offers many perks through its home loan programs. Here are some of them-

Pros of Navy Federal Credit Union Home Loan

  • Through its freedom lock, you can qualify for a fixed-rate mortgage that can make your monthly installments stable.
  • Apart from conventional loans, they offer no downpayment perks.
  • Most of the loans do not require you to pay for PMI.
  • Navy Federal has been listed as a top VA loan lender.

Cons of Navy Federal Credit Union Home Loan

While there are some remarkable perks offered by the credit union, it also has some downsides.

Here are some of the cons of Navy Federal-

  • The credit union has a small branch network.
  • These services are not available to civilians.
  • You might get lower rates through online banks.

Navy Federal Credit Union Application Process

To reap the benefits of the services offered by Navy Federal, you must qualify to become a member. To qualify, any ONE of the following must be true-

  • You are an active military member of the uniformed services mentioned above.
  • You are a member of the Delayed Entry Program.
  • You are a DoD Officer Candidate/ROTC.
  • You are a DoD Reservist.
  • You are a Veteran.
  • You are a parent, grandparent, spouse, sibling, child, or grandchild of a service member.
  • You are a civilian employee working within the Department of Defense.

To get started with the membership, you would need your social security number, driver’s license/any government ID, home address, and bank account details like routing number. To maintain membership, you must have a minimum balance of $5 in your membership savings account.

Navy Federal Credit Union Refinancing

Navy Federal Credit Union offers refinancing options on the following loan options-

  • VA Interest Rate Reduction Refinance Loan (VA IRRRL)
  • VA home loans
  • Military choice
  • Conventional fixed-rate navy federal credit union mortgage
  • Homebuyers choice
  • Adjustable-rate navy federal credit union mortgage

The refinancing interest rate for VA home loans, conventional fixed-rate mortgages, and VA IRRRL starts from 2%. For military choice, interest rates start at 3.875%. For adjustable-rate and homebuyers choices, the starting rate is 2.125% and 4%, respectively.

Navy Federal Credit Union Alternatives

If becoming a member of the Navy Federal Credit Union does not seem right, you can go for the following alternatives-

USAA

Like Navy Federal, USAA is open exclusively to service members and family members. With services available in all 50 states, it is known for its outstanding customer service and online presence.

Veterans United

Veterans United is the largest lender in the US when it comes to VA loans. It offers 24/7 customer service and has online procedures for application and prequalification. You can also find employed advisors for each brand of the armed forces.

LendingTree

Based out in North Carolina, LendingTree offers home loans and mortgage refinancing to consumers. However, it might not be a great choice as it does not directly provide loans. Instead, it allows different lenders to get in touch with people looking for a mortgage.

Navy Federal Credit Union Transparency

Navy Federal Credit Union offers considerable benefits for veterans, including their reputation, transparency, vast loan options, and member perks. Visit their website for everything about how to become a member and the advantages offered by different products. There are numerous home loan types that you can explore to determine if it’s the best financing option for you.

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