Watermark Home Loans Reviews

Like many mortgage lenders, Watermark Loans doesn’t publish its rates. It does post national average rates — and promises to beat them. The company’s credit and LTV calculator lets you run various credit scenarios and see typical associated rates. To receive a custom rate quote, click the “Get My Rate” button on the company’s website. You will have to answer five or six brief questions about the home you want to buy, its ZIP code and your salary and credit score.

You can also sign up for Watermark’s Rate Watch alerts. This will keep you current on interest rate trends and notify you via email if rates go up or down.

Recent Home Mortgage Disclosure Act data shows that Watermark has slightly lower rates than the national average. Many factors can affect the rate you’re offered, including the economy and your personal finance details. Borrowers with high credit (above 800) and low DTI ratios (below 36%) typically get the best rates, but Watermark does offer programs for borrowers who don’t have great scores or who have limited funds for a down payment.

Watermark Home Loans average home purchase rate vs. national average

Watermark Home Loans touts a wholly digital mortgage application process. To start an application online with Watermark, just create a profile and follow instructions on how to upload your documents to its secure platform. Or, if you prefer to start by phone, a loan officer will help you work your way through. Its e-closing and remote notary services also make it possible to obtain a mortgage without ever leaving your home.

Watermark Home Loans application features

Watermark Home Loans offers fixed-rate conventional loans (no adjustable-rate loans), FHA loans, VA loans, USDA loans and jumbo loans, and it does a significant amount of refinancing. It also offers non-qualifying mortgage loans and other specialty programs.

For the self-employed who don’t have W-2s to prove income for a conventional loan, Watermark underwriters look at a combination of cash flow, assets and bank statements. There are low-interest options available.

In 2021, potential Watermark borrowers initiated 1,337 home purchase applications. About 3% were denied, which is a lower denial rate than the industry shows as a whole.

About 85% (1,138) of these home purchase applications closed, and zero preapprovals were denied — so it may pay to be preapproved if you’re looking for reassurance that your deal will go through.

Loan applications for home purchases only by year

Refinancing

In the past three years, refinancing represented a large portion of Watermark’s business. In 2021, this type of financing accounted for 83% of its loans. Rates were low then, and there was increased demand from homeowners who wanted to lock in a lower rate.

With rates rising this year, demand shouldn’t be so high, but it can still make sense to refinance if you can find a rate that’s significantly lower than what you have. Do consider closing costs, though; your loan advisor can help you weigh the pros and cons.

Home purchase vs. refinance loans by year

Watermark is transparent about requirements for most of its loans. Conventional loans require a 3% down payment and a minimum credit score of 620, which is typical across the home loan industry. Credit scores below 620 may be accepted on FHA loans, but you’ll need to put 3.5% down. VA and USDA loans require no down payment.

Another thing lenders take into account is your debt-to-income ratio (looking for 36% or lower). Watermark does have non-qualifying loans available for those who can’t meet this requirement, including interest-only options. Both non-qualifying loans and government-backed loans (except USDA) allow higher debt-to-income ratios.

National mortgage requirements by type

For other loan types, read our jumbo loans guide.

Watermark charges origination fees, which are typically 0.5% to 1% of the loan amount. Other fees you may have to pay at closing include appraisal fees, real estate taxes and mortgage insurance premiums. In some states you’re required to hire an attorney for real estate transactions, so in those states you’ll also pay attorney’s fees. The closing costs on a home purchase often add up to 2% to 5% of the loan amount.

Shortly after you’re preapproved for your mortgage, you’ll receive a Loan Estimate that itemizes each of your closing costs. Later in the process, three days before the closing, you’ll receive the Closing Disclosure. This document provides an exact account of what you’ll be expected to pay that day.