U.S. Bank Home Mortgage Review: A Physical Bank with Online Tools and Discounts for Existing Customers

An image to accompany a review of U.S. Bank mortgages Illustration/NextAdvisor

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U.S. Bank is a mortgage lender that lends in all 50 states and has physical locations in 26 states. U.S. Bank offers a digital application process with the option of an in-person experience within one of its branches. U.S. Bank is the 6th largest mortgage lender with an extensive menu of  mortgage products available to choose from. The mobile mortgage dashboard makes it easy to manage your account. 

The main drawback is that you can’t get a rate and fee estimate before applying. However, you can prequalify all online and get an estimate without a credit check. 

Pros and Cons of U.S. Bank Home Mortgages

Pros

  • Large mortgage product menu

  • A digital application process

  • Loan officers available to assist you

  • Existing customer credit up to $1,000

  • Available in all 50 states

Cons

  • Advertised mortgage rates are for creditworthy borrowers

  • Not all loan programs or amounts available in all states

  • Physical branches in only 26 states

  • Limited rate and fee information online

 U.S. Bank Home Mortgage: Loan Types and Products

U.S. Bank offers both conventional loans and government-backed mortgages. You can get the following loan types, but not all products are offered in all states:

  • Conventional fixed-rate loans: Has the lowest fixed rates and come in 10, 15, 20, and 30-year terms. 
  • Adjustable-rate mortgages: Provides the lowest short-term rates and comes with lower monthly payments for the first few years. But it switches to variable market rate later. 
  • FHA loans: Designed for lower-income borrowers, these government-backed loans have looser credit standards.  
  • VA loans: Active duty military, veterans, and qualifying family members can access these loans, which come in fixed and adjustable-rate varieties and require a $0 or low down payment. 
  • Jumbo loans: Larger loan amounts that exceed conforming loan limits.
  • Investment property loans: U.S. Bank offers various loan options for people seeking to purchase a 1-4 unit rental building. 
  • New construction and lot loans: Comes with construction-to-permanent loan options for borrowers building a home. 

U.S. Bank Home Mortgage: Transparency

U.S. Bank advertises rates and fees a little differently than some of its competitors. For example, some lenders provide rates and fee grids that match up with credit profiles and incomes. U.S. Bank, however, advertises a few mortgage products with potential rates. However, the rate you see is based on ideal creditworthiness and assuming a 20% down payment. 

For example, a 30-year fixed conventional loan is advertised with a low market rate, but you’ll need a downpayment of 20%, a borrower-paid finance charge of 0.862%, and a very good credit score (740+). Not every borrower fits into this bucket, so it’s good practice to read the fine print and compare rate quotes among lenders. 

The lender offers two separate steps online to get a rate quote:

  • Prequalifying application: On an online form asking for your name, address, date of birth, residency status, annual income, and other debts. Once you complete the form, you can see an estimate on rates, fees, and how much you can borrow online. The website also states this step does not affect your credit. 
  • The mortgage loan application allows borrowers to fill out all their qualifying information, upload documents, and receive approval all online. A hard credit pull that affects your credit score is typically required at this stage, even though it’s not clearly stated on its website. 

U.S. Bank Home Mortgage: Rates and Fees

U.S. Bank doesn’t provide origination fees online because it varies by state. The lender charges a $395 application fee, but that fee is refunded as a credit once you close. If you have an existing U.S. Bank first mortgage or a U.S. Bank Personal Checking Package, you can qualify to save 0.25% on the total closing costs, up to $1,000. U.S. Bank does not charge a prepayment penalty and late fees also vary by state. 

U.S. Bank typically works with borrowers who have a 620 credit score or higher. Interest rates and APRs vary by location, loan size, and the borrower’s FICO score. You can view current market rates based on the borrower’s location, but the rates for conventional and jumbo loans are based on a 20% downpayment and a 0.862% finance charge, while rates for FHA loans are based on a 3.5% down payment, monthly mortgage insurance, and a finance charge of 0.862%. Rates for VA loans are based on a $0 down payment and a $4,025 VA funding fee. 

Borrowers may pay out of pocket for:

Refinancing with U.S. Bank

U.S. Bank offers traditional refinancing and cash-out refinancing, and if you have a U.S. Bank first mortgage or a U.S. Bank Personal Checking Package, you’ll receive a credit worth 0.25% of the loan amount, up to $1,000. U.S. Bank also offers a Smart Refinance option with no closing costs, but this program isn’t eligible for the discount. 

It’s important to note that a no-closing costs loan doesn’t mean you skip the closing costs altogether. It means those fees are rolled into the loan balance and financed along with the loan. The benefit is you don’t pay for closing costs upfront and out-of-pocket, but you do pay for it plus interest. 

You can apply online for refinancing, and the process can take anywhere from 30-90 days. The  $395 application fee will be credited back to you if you choose to close. All other refinancing fees vary by state. 

U.S. Bank Compared to Other Mortgage Lenders

U.S. BankChaseBank of America
Minimum credit score620 for conventional740 for jumboNot ProvidedConventional: 620FHA and VA: 620Jumbo: 720
Minimum down paymentConventional: 5% Jumbo:  10% for FHA: 3.5% VA: 0%Conventional: 5%Jumbo: 20%FHA: 3.5%VA: 0%DreaMaker 3% Conventional: 5%Jumbo: 20%FHA: 3.5%VA: 0%
Where does the lender operate?All 50 statesAll 50 statesAll 50 states
Major loan typesConventional fixed-rate, ARM, FHA, VA, jumbo, investment, new construction, traditional refinance, cash-out refinance, smart refinance, home equityConventional fixed-rate, ARM, FHA, VA, DreaMaker, jumbo, traditional refinance, cash-out refinanceConventional fixed-rate, ARM, FHA, VA, jumbo, traditional refinance, cash-out refinance, home equity

How to Shop Around to Get the Best Mortgage Rate

The best way to ensure you get the lowest APR available is to compare rates and fees across multiple lenders on the same day. You can prequalify with most lenders without hurting your credit. Pay attention to differences in estimated rates from various lenders since even a slightly lower interest rate could save you thousands over the life of your loan. And when you’re ready to formally apply to a few lenders, make sure you do so within a 2-week period to avoid multiple hits to your credit. 

Here is an example: Let’s say you receive two mortgage rate quotes on a home worth $350,000 with a 20% down payment and 30-year term. 

Interest RateMonthly Principal and Interest PaymentTotal Savings on Interest 
3.5%$1,257
3.25%$1,218$13,816

The higher 3.5% interest rate gives a monthly principal and interest (P&I) payment of $1,257 over 30 years. However, lowering that rate to 3.25% lowers the monthly P&I by $39. That doesn’t sound like much, but over 30 years, that adds up to a savings of $13,816 in interest. 

Bottom Line

U.S. Bank offers a variety of mortgage types and an easy, digital application process. In 26 states, you also have the option to visit a physical branch for more assistance. Based on the company website, rates are competitive for creditworthy customers. You’ll need to prequalify to get an understanding of what rates and fees each borrower can get. U.S. Bank can be a good option for existing U.S. Bank customers, who are eligible for a credit of up to $1,000. However, all borrowers should compare multiple lenders when making a decision.