Lower Mortgage Review
Lower at a glance
 | Minimum credit score: 580 Minimum down payment: 0% to 3% Available loan products and programs: Conventional, FHA, VA, USDA, Jumbo, HELOCs |
Our verdict: Lower, an online lender that also bills itself as a fintech company, could steal the hearts of borrowers who want a digital-first lending experience. With a handful of unique tools and perks, Lower offers convenient and compelling service to the tech-savvy.
| Pros | Cons |
|---|---|
Apply for preapproval or submit a mortgage application online Receive customer service via text message and after hours Refinance a Lower mortgage as many times as you like without paying lender fees | No in-app dashboard to track your application or loan status Lender fees aren’t disclosed online Doesn't offer FHA streamline refinances |
Lower is an online-only direct mortgage lender headquartered in New Albany, Ohio. In addition to a wide variety of mortgage products, Lower offers interesting perks like fee-free refinances for life, the ability to text with your mortgage loan advisor and even a courier service so you don’t have to travel to sign paper documents. Other tools provided by Lower include a real estate agent matching service and an online tool for comparing homeowners insurance quotes from more than 35 different carriers.
Lower mortgage products
Conventional
- Purchase loans are available with 10-, 15-, 20-, 25- and 30-year fixed-rate terms. For those seeking an adjustable-rate mortgage (ARM) option, Lower also offers a 5/5 ARM.
- Rate-and-term refinances are available to help lower your monthly payments or get you out from under your mortgage faster.
- Cash-out refinances are available for homeowners who want to free up cash by borrowing against their home equity.
FHA
- Purchase loans from the Federal Housing Administration (FHA) are available to buyers who may need more flexible qualification requirements, like a minimum 580 credit score.
- Rate-and-term refinances are an option for homeowners looking to reduce their monthly mortgage payments or change their loan terms.
- Cash-out refinances from Lower may be a good choice for homeowners who want to tap their home equity to put cash toward other financial goals.
VA
- Purchase loans are available for qualifying military borrowers.
- Streamline refinances, also known as interest rate reduction refinance loans (IRRRLs), are available for borrowers who already have mortgages from the U.S. Department of Veterans Affairs (VA).
- Cash-out refinances are available for VA borrowers who have built sufficient home equity and want to convert it to cash.
Home equity
- Home equity lines of credit (HELOCs) through Lower allow you to borrow up to a 95% loan-to-value (LTV) ratio, but if you want to access those higher LTVs, you must use a HELOC “combo” loan, which means taking out the credit line and refinancing your mortgage in the same transaction.
Jumbo
- Jumbo loans are available for buyers who want to buy a high-value property that exceeds conforming loan limits.
- High-LTV “combo” loans (sometimes called piggyback loans) are also an option and can be used to lower your down payment on a jumbo loan.
Special programs
- U.S. Department of Agriculture (USDA) loans are offered to qualifying buyers purchasing single-family homes in rural areas.
Lower mortgage rates and fees
Rates
Lower advertises its lowest rates on both its homepage and its “Finance” and “Refinance” pages. The rates quoted include a discount point charge and are based on a 30-year fixed-rate $200,001 loan with at least a 25% down payment, according to the fine print.
Compared to other large national lenders, Lower’s rates are on the higher end and, on average, came in around 0.72 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
Lower provides a list of the origination fees and other loan-related closing costs it may charge online, but doesn’t provide amounts and warns that the list is “not comprehensive.”
The average total cost of taking out a mortgage with Lower was $7,814 in 2022, according to data from the Federal Financial Institutions Examination Council (FFIEC). That included an average of $3,808 in origination fees.
| Mortgage rates published online? | |
| Rate information updated daily or weekly? | * *Rates aren't updated on a regular schedule |
| Lender fees disclosed? |
Lower’s application experience
You can apply for a Lower mortgage or HELOC online and submit your application within minutes. It’s also easy to get preapproved online, and all of these processes are streamlined by the ability to upload documents from your phone and Lower’s willingness to bring physical documents to you for signing. You can also choose an eClosing for your loan or go for a hybrid option.
How to boost your loan approval odds
Lower doesn’t share the exact minimum requirements it uses to approve or deny your application. However, based on nationwide data from 2022, we can say that Lower approved customers who — on average — had a 83% loan-to-value (LTV) ratio or better. Most had a debt-to-income (DTI) ratio below 40%.
In that same year, Lower denied about 26% of its mortgage applications. That’s right in the middle of the pack when compared with other large, national mortgage lenders. For comparison, it’s not atypical to see denial rates in the low teens through mid-thirties.
Lower’s customer service experience
Lower’s customer service is available by phone at 833-920-2273 Monday through Thursday 9 a.m. to 6 p.m. and Friday 9 a.m. to 4 p.m. EST, and even has a dedicated number for 24/7 text messages: 855-293-1776. Support by email is available at [email protected]. Lower offers an app, but it’s aimed primarily at customers using its savings account product, not mortgage customers. It doesn’t contain a dashboard for applicants to track their application’s status.
How does Lower compare to other lenders?
| Lower Mortgage | PenFed | Better Mortgage | |
|---|---|---|---|
| Lender rating | |  |  |
| Minimum credit score | 500 | 620 to 650 | 620 |
| Minimum down payment | 0% to 3% | 0% to 3.5% | 0% to 3.5% |
| Loan products and programs |
|
|
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| Rate spread* | 0.72% | 0.11 | 0.14% |
*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) Lower offered to mortgage customers in 2022. The higher the number, the more expensive the loan.
How we rated Lower
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.
Lower’s scorecard: 4/5
Publishes rates online
Offers standard mortgage products
Includes detailed product info online
Shares resources about mortgage lending
Provides an online application