Homebuyers can obtain a mortgage through many different channels, including online, at a local branch or some combination of the two. A popular destination for online mortgage shoppers is Ditech Financial LLC, but customer reviews show conflicting opinions on customer service. Ditech offers a range of mortgage products, including fixed-rate, adjustable-rate, jumbo, FHA, VA and manufactured home loan products.

About Ditech

Ditech Financial LLC, owned by Walter Investment Management Corporation (NYSE: WAC), is a leader in the mortgage banking arena as a servicer for residential mortgages, and was one of the first online lenders. The company managed to survive the mortgage crisis, and currently employs more than 4,500 people in the United States.

Mortgages Products Offered

Ditech’s fixed-rate mortgage allows the homebuyer to lock in the interest rate and the principal and interest (P&I) payments for the life of the loan. Fixed-rate loans provide the borrower with stability, an option to secure a lower rate with discount points, a downpayment as low as 5 to 20% of the home’s value, no prepayment penalty and flexible loan terms ranging from 10 to 30 years in five-year increments. Ditech’s fixed-rate loans are good for homebuyers planning to stay in their homes for longer than seven years. In general, homebuyers need at least 5 to 20% of the home’s value for a downpayment.

Ditech’s adjustable-rate mortgage (ARM) provides interest rates for five, seven or 10 years. Homebuyers receive a lower initial rate, but after the initial term of the loan, the interest rate increases based on market rates. Ditech’s ARMs provide rate caps that limit exposure to large increases in market rates over the life of the loan. There’s also no prepayment penalty for paying off early. ARMs are ideal for homeowners who plan on refinancing in the next five to seven years.

Jumbo loans at Ditech provide competitive rates for loans from $417,001 to $3 million on a single family home, and the ability to borrow up to 65% of the home’s value for cash-out refinancing. Ditech’s jumbo loan program is currently not available in West Virginia. Ditech also offers Federal Housing Administration (FHA) loans. These are some of the easiest loans to obtain, because they are insured by the FHA. The downpayment can be as low 3.5% of the home’s value and loan qualifications make an allowance for less-than-perfect credit. Ditech also offers loans for veterans, active-duty personnel, reservists, National Guard members and, in some cases, surviving spouses. VA loans give the homebuyer the ability to refinance up to 100% of the home, with no downpayment required. There’s also an allowance for less-than-perfect credit. Finally, Ditech offers manufactured home loans, as long as they are classified as real property and not resting on wheels.

Mortgage Rates

Mortgage rates vary daily, but the rate for a 15-year fixed-rate mortgage at Ditech, as of May 5, 2016, was 2.99%, with an annual percentage rate (APR) of 3.09%. The 30-year fixed-rate is 3.75%, with an APR of 3.807%. The FHA 30-year fixed-rate is slightly lower than the standard 30-year fixed-rate at 3.25%, and 4.243% APR. The 30-year VA is available at the same rate, but at an APR of 3.484%. The five-year ARM rate is 3.25%, with an APR of 3.451%. Homebuyers must inquire directly about jumbo and manufactured home loans, as the rate is dependent on the needs of the homebuyer.

What Consumers Are Saying

Customer reviews on Lendingtree.com gave Ditech 4.8 out of five stars, as of May 2016. Out of the 83 reviews, 77 are five stars, two are four stars, one is two stars and three are one star. Customers rated the company as "excellent" in interest rates, fees and closing costs, customer service and responsiveness. ConsumerAffairs.com rates Ditech one out of five stars, based on 288 reviews and 220 ratings. Of these, 97% of the ratings are one star, 2% are two stars, 1% has four stars and 0% has five stars. Most of the errors cited in the review are based on servicing and customer service errors.

LendingTree Mortgage Overview (TREE)

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