Shopping for a home loan? Navy Federal and Rocket Mortgage are likely names you’ve heard. One’s a hub for helping Veterans and their family’s finance homes, and the other’s a call center powerhouse. But which one really deserves your attention? Let’s break it down.
The basics
Navy Federal: Navy Federal is a major player in home lending, particularly known for serving military members and their families. Interestingly, Navy Federal’s loan volume is made up of more conventional loans than VA, 55% conventional and 45% VA loans.
In late 2023 and early 2024, the credit union found itself in hot water with a civil rights lawsuit. Black and Latino borrowers alleged that Navy Federal engaged in discriminatory practices, denying them equal access to home loans compared to white borrowers. As of March 2024, Navy Federal responded by seeking dismissal of the suit. It raises questions about how this legal battle could impact their lending practices moving forward.
Rocket Mortgage: Rocket Mortgage, formerly Quicken Loans, is a giant in retail lending. With billions poured into marketing, they’re hard to miss.
We’re certainly curious why Rocket’s refinanced loans accounted for a quarter of their volume—112,710 loans—during a time when rates were among the highest in the last decade. It makes one wonder about the factors that led so many borrowers to refinance under those conditions.
Tomo Mortgage: Launched in 2020, Tomo Mortgage is here to shake up the industry. We offer killer rates, zero lender fees, and a process that’s all about making home buying easy and stress-free. Our customer reviews? 4+ starts on every review platform: Consumer Affairs, Google, Bankrate, Zillow, etc. We’re not just a breath of fresh air—we’re a whole new way of doing things.
The breakdown
| Lender | Navy Federal | Rocket Mortgage | Tomo Mortgage |
| Founded | 1933 | 1985 | 2020 |
| Lender Fees | $2,200 per conventional loan, $1,000 per VA loan* | $4,700 per loan* | $0 |
| On-Time Close Rate | Not reported | Not reported | 98% |
| Customer Reviews | 1.2 stars on Consumer Affairs | 4.1 stars on Consumer Affairs | 5.0 stars on Consumer Affairs 4.9 stars on Zillow |
| Employee Reviews | 4.1 Stars on Glassdoor | 3.5 stars on Glassdoor | 4.1 stars on Glassdoor |
How to judge mortgage lenders
- Interest rates: Don’t get fooled by flashy numbers. Always compare the “par rate” with 0 points and check out the APR (Annual Percentage Rate). This is your real cost of borrowing, so get the full picture before signing up.
- Lender fees: Also called “origination fees” or “application and processing fees, which Veterans United and Rocket Mortgage charge over $1,000 in per loan. At Tomo Mortgage, we’re lender fee-free, saving you thousands of dollars at closing.
- On-time close rate: This is how often lenders actually close on the promised date. Industry standard? About 40%. But Tomo Mortgage –flexing a 98% on-time close rate, and we’re proud of it. Other lenders don’t even bother to share this info, but it’s a huge deal.
- Pre approvals: While some lenders don’t take the time necessary to prepare a strong pre approval and offer letter, this is critical to making a successful offer on a new home. Tomo Mortgage’s online pre approval only takes 15 minutes, and it includes a soft credit check—but way more reliable when you’re making an offer on a home.
- Customer satisfaction: If you’re finding it tough to trust what lenders are telling you, one of the best ways to gauge their reliability is by looking at reviews from people who were once in your shoes. Did those customers have a smooth experience with the lender? What went right—or wrong? Navy Federal’s customer satisfaction certainly leaves room for some growth.
- Employee reviews: Insights into employee satisfaction can reveal a company’s values and transparency. Unhappy employees often lead to bad overall experiences. (See what their engineers have to say, for example.)
The verdict: Navy Federal or Rocket Mortgage
If you value emphasis on a military community, Navy Federal could be worth considering. They excel with VA loans however their questionable lending practices and low customer satisfaction may be a reason to pause.
For most people the most important factor is the rate. We were curious to see how Tomo Mortgage’s APR (annual percentage rate) stacked up against Rocket Mortgage so we looked at three Zip codes for two weeks on Nerdwallet (where we could compare apples-to-apples on loan scenarios). Using the median home sale price for each location, a credit score range of fair at 680, and with putting 5% down.
In this scenario, from August 7 to August 20, 2024, Rocket’s average APR was 7.64% while Tomo’s average APR was 6.26%.
So, we’re obviously biased, but we’d say don’t choose either. Tomo Mortgage has lower rates, lower fees, and better reviews. It’s a pretty obvious choice.
*sources: Business Insider Mortgage Reviews: Navy Federal, Rocket Mortgage, and HMDA data from 2023
If you’re ready to start your journey to homeownership, get pre approved with Tomo Mortgage today.