Ally Bank Mortgage Review
Ally Bank at a glance
 5 stars
| Minimum credit score: 620 Minimum down payment: 3% Available loan products and programs: Conventional, Jumbo |
Our verdict: Ally provides a clear and transparent online process, paired with quick turnaround times. For homebuyers in the market for a conventional or jumbo loan who are comfortable with a largely digital mortgage experience, Ally is a solid choice.
| Pros | Cons |
|---|---|
You can apply online and get preapproved for a mortgage in as little as three minutes. You won’t have to wait long to close (Ally closes 10 days faster than the industry average, which is around 50 days). Your closing costs won’t include any lender fees. | You won’t find FHA loans, VA loans or USDA loans. You won't have access to home equity loans or lines of credit. You won’t get in-person service with your mortgage because Ally doesn’t operate branches. |
Ally Bank is an online financial institution and lender headquartered in Detroit. The bank was founded in 1919 as a division of General Motors and rebranded as Ally in 2009. As part of their partnership with Better Mortgage, Ally is able to offer customers a cutting-edge online experience built on Better’s speedy and time-tested mortgage processing platform. Ally is licensed to lend in 46 states — a list that doesn’t include Hawaii, Nevada, New Hampshire or New York.
Ally Bank’s mortgage products
Conventional
- Purchase loans are available with 15-, 20- and 30-year fixed-rate terms.
- Adjustable-rate mortgages (ARMs) are also an option and offer 5-, 7- and 10-year initial fixed-rate periods.
- Rate-and-term refinances with Ally can help homeowners save on their monthly mortgage payments or change their loan terms.
- Cash-out refinances are available for homeowners who wish to borrow against their home equity.
Jumbo
- Jumbo loans are available for up to $4 million with a minimum 10% down payment and can be used for a wide variety of property types including vacation homes and investment properties.
Special programs
- Ally offers Fannie Mae’s HomeReady program, which is designed to support buyers earning less than 80% of the area median income and requires only a 3% down payment.
Ally Bank’s mortgage rates and fees
Rates
Ally publishes current mortgage rates online for both its fixed-rate and adjustable-rate loans. It also offers the ability to customize the rates you’re seeing according to credit score, location, housing type, home price and more. Rates quoted also include options for buying mortgage points to lower the interest rate or receiving a lender credit in exchange for a higher rate.
Compared to other large national banks, Ally’s rates are reasonably competitive, and on average came in around 0.13 percentage points above the average prime offer rate (APOR) in 2022. The APOR is a benchmark rate that captures what is, in effect, the lowest APR a bank is likely to offer in the current market. Mortgage loans aren’t typically considered “higher-cost” until they reach 1.5 percentage points over the APOR.
Fees
Ally notes that it doesn’t charge lender fees (application, origination, processing or underwriting fees). While this does streamline the process, it doesn’t necessarily mean that you’ll save a ton on your loan. Lenders who offer “fee-free” mortgages often build these costs into another part of the loan to make sure they don’t lose out. The average total cost of taking out a mortgage with Ally was $4,726 in 2022, according to data from the Federal Financial Institutions Examination Council (FFIEC).
Tip: The only way to be sure you’re getting a great deal is to shop around and compare both the interest rates and annual percentage rates (APRs) on any loan offers you consider.
| Mortgage rates published online? | |
|---|---|
| Rate information updated daily or weekly? | |
| Lender fees disclosed? |
Ally Bank’s application experience
Ally makes it easy to apply online and get preapproved in minutes. You can upload, sign and submit documents online. Closing, however, isn’t digital — you’ll have to sign the final paperwork in person.
How to boost your loan approval odds
Ally doesn’t disclose the exact minimum requirements it uses to approve or deny your application. However, based on nationwide data from 2022, we can say that Ally approved customers who — on average — had:
• A 74% loan-to-value (LTV) ratio or better
• A 40% debt-to-income (DTI) ratio or lower
In that same year, Ally denied about 21% of its mortgage applications. That’s not particularly high when compared with several other large, national mortgage lenders.
Ally Bank’s customer service experience
Customer service is available via phone at 855-256-2559 and can be accessed Monday through Friday from 8:30 a.m. to 8:00 p.m. EST, and Saturdays from 8:30 a.m. to 1:00 p.m. EST. If you aren’t a customer yet but are seeking a new home loan, you can enjoy extended hours to 10 p.m. on weekdays and 4 p.m. on Saturdays.
If you prefer texting, you’ll be happy to know that you can also text your loan officer with questions.
How does Ally Bank compare to other lenders?
| Ally Bank | Flagstar Bank | Mr. Cooper | |
|---|---|---|---|
| Lender rating |
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|
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| Minimum credit score | 620 | 580 to 620 | Not published |
| Minimum down payment | 3% | 0% to 3.5% | 0% to 3.5% |
| Loan products and programs |
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| Rate spread* | 0.13 | 0.74 | 0.58 |
*Rate spread is the difference between the average prime offer rate (APOR) — the lowest APR a bank is likely to offer any private customer — and the average annual percentage rate (APR) Ally offered to mortgage customers in 2022. The higher the number, the more expensive the loan.
How we rated Ally Bank
LendingTree’s mortgage lender rating is based on a five-point scoring system that factors in several features, including digital application processes, available loan products and the accessibility of product and lending information.
LendingTree’s editorial team calculates each rating based on a review of information available on the lender’s website. Lenders receive a half point on the “offers standard mortgage products” criterion if they offer only two of the three standard loan programs (conventional, FHA and VA). In some cases, additional information was provided by a lender representative.
Ally Bank’s scorecard: 5/5
Publishes rates online
Offers standard mortgage products
Includes detailed product info online
Shares resources about mortgage lending
Provides an online application