Rocket Mortgage Vs. loanDepot: Better Price Transparency With Rocket Mortgage

Finding the best mortgage lender for your needs can sometimes be a tedious part of the home buying process, but it can be well worth your time and effort. 

Interest rates can vary by 0.50% or more between two similarly qualified borrowers, according to research by the Consumer Financial Protection Bureau. While it may not seem like much, on a large loan like a mortgage, even a small difference in the interest rate can help you save thousands of dollars over the life of the loan. 

But what should you look for as you’re shopping around? Which factors are most important to consider? Here at NextAdvisor, we’ve developed a robust methodology to determine the best mortgage lenders in the country. 

We score our lenders on factors like transparency in pricing, online convenience, accessibility to most borrowers, range of products, and history of customer satisfaction.

To demonstrate how to compare different lenders, we’ve taken two of the most popular names in the mortgage industry, Rocket Mortgage and loanDepot, and put these factors side by side. 

Rocket Mortgage and loanDepot are both non-bank lenders that conduct most of their business online in all 50 states. But they differ in a few areas, such as loan types offered and the accessibility of pricing. Here’s how the two companies stack up against each other.

Mortgage Lender Comparison: Overview of Rocket Mortgage vs loanDepot

Rocket mortgage is the online mortgage lender for Quicken Loans and is one of the largest mortgage lenders in the U.S. NextAdvisor named the Detroit-based company as one of the best mortgage lenders because of its simple online application process, large nationwide footprint, low level of consumer complaints, the transparency and accessibility of its rates and fees, and the company’s wide offering of mortgage loan products. 

loanDepot is a solid option with fast closings, solid product menu, and positive history with consumer complaints. However, we found there were layers and extra steps to obtain rate and fee information compared to Rocket Mortgage. 

Here’s an overview between Rocket Mortgage and loanDepot. 

Rocket Mortgage vs loanDepot: Products Offered

Different types of loans will each have their own set of perks and benefits. For instance, conventional loans can be a great choice for borrowers with good credit, income, and assets that can be documented. On the other hand, those struggling with saving for a down payment but have a military affiliation may be eligible for a 0% down payment VA loan. Similarly, some lenders may not be able to work with first-time homebuyer programs and grants that assist with down payments and closing costs. When shopping rates with different lenders, find out if their product offerings match your needs.  

loanDepot’s mortgage product menu is more extensive than Rocket Mortgage. If you’re looking for a construction loan, renovation loan, adjustable-rate mortgage, or rehab loan (FHA 203(k)), loanDepot will have you covered. Here’s side-by-side look at Rocket Mortgage and loanDepot’s product menu:

Rocket Mortgage vs loanDepot: Rates and Fees 

Each mortgage lender offers varying interest rates and fees. These rates and fees can be offered in a number of different ways, which can make it challenging to get a clear picture of which lender is offering the best deal. For instance, some lenders will offer a lower interest rate, but simply tack on discount points and other fees to the loan. Other lenders will offer what seems to be a higher interest rate but instead charge fewer fees by covering your lender fees and closing costs. It’s important to understand all of the fees involved with your loan as this will allow you to make an informed decision as to which lender is best for you.  

While rates and fees can vary depending on the loan program you select, we obtained loan estimates from Rocket Mortgage and loanDepot for a conventional loan of $160,000 to give you an idea of the specific fees that may be charged. 

Rocket Mortgage vs loanDepot: Transparency and Online Conveniences

Transparency and the convenience of obtaining information online can go a long way in making it easy to find the best loan for your needs. That is why price transparency is one of the five main scoring criteria to determine the best mortgage lender. Some lenders, like Rocket Mortgage, offer a level of transparency by providing rate quotes online, along with a list of third-party fees. When it came to loanDepot, we were unable to locate any of this information on their website. Instead, we had to submit an application. While it was an extra step, the loan representative we spoke with was very informative and walked us through several loan options. 

Rocket Mortgage, named one of NextAdvisor’s best mortgage lenders, provides rates online, although detailed information about fees and options for discount points or lender credits requires a phone call with one of their representatives.  

Rocket Mortgage or loanDepot: Who Is Better to Refinance With? 

Refinancing can help you meet your goals in one of several ways. You can use it to lower your monthly mortgage payment or shorten the loan term to pay off your mortgage more quickly. If you have enough equity in your home, you could also do a cash-out refinance to help pay for things like home improvements or pay off other higher interest rate debt. While there is typically no limit to how many times you can refinance, each time you do so can lead to several thousand dollars in lender fees. Make sure you use a good mortgage calculator in determining how a refinance will help you reach your goals before getting too far into the process.  

When it comes to borrower incentives, loanDepot offers a lifetime guarantee. By getting a mortgage loan with the company, loanDepot will waive all lender and appraisal fees if you decide to refinance your home with them again in the future. If this is something you might want to take advantage of, make sure to read all of the requirements to be sure you would be eligible for this guarantee. 

How to Shop for a Mortgage Lender

When it comes to shopping for rates, it’s important to consider different types of lenders. You may find that a bank, credit union, or mortgage broker offers certain incentives or loan programs best suited for your specific needs. Also, don’t forget to request a written loan estimate, as it can help you avoid unexpected fees or charges from showing up at a later date. 

To simplify the process of comparing fees and rates among lenders, make sure that you provide the same loan information to each lender, such as the loan amount, property type, and location. Once this is done, try to compare the same interest rate to see how it compares to another lender. This can be an important step in shopping rates, because some lenders may advertise a low interest rate, but simply charge additional fees and discount points. On the other hand, a higher interest rate may not seem as attractive, but if a lender offers to cover all of the closing costs, it may end up being the more cost-effective solution. 

Finally, if you’re in the market to purchase a home, know that a prequalification is not the same as a preapproval. A prequalification will show that you are taking the initial steps to determine how much house you can afford but typically does not involve verifying any of your financial documents. A preapproval, on the other hand, is usually only issued after a bank has verified your credit, income, and assets to be sufficient for a certain loan. 

As a home buyer, a prequalification is a good start, but a pre-approval will give you much more credibility and clout when making offers for sellers to consider. 
Whether you are looking to purchase or refinance, you can compare lender offers here using this Home Loan Comparison Tool. You can enter in the loan amount, rate, fees, and term for each offer and see a true side-by-side comparison of your potential monthly mortgage payment and how closing costs, lender fees, and interest rates play out over time with each loan offer.