Winnpointe Mortgage mailings

So you probably received a mailing from a mortgage company called Winnpointe.  It looked something like this:

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You searched the Net and didn’t find any particularly disturbing complaints about them.   But that’s changed.   In fact, recently,  the Consumer Services Division of Washington’s Department of Financial Institutions office went after this, and other mortgage companies, for fraudulent or deceptive advertising.    Winnpointe notes that in response to this complaint, Winnpointe chose not to do any more business in Washington.   It also paid a $10,000 fine and donated $10,000 to a Financial Literacy Program

Should this assuage you?  Our major beef with Winnpointe is that they are attracting customers with deceptively low rates and then pushing 15-year loans upon customers who won’t benefit from them.  We looked more deeply into Winnpointe when we got their mailer which offers an unusually low mortgage rate and promised reduced mortgage payments.  The 3.25% loan advertised in this mailer is for a 15-year loan, but you can’t know that unless you read the fine print.   We filled out their website “application” and got a call from a cheerful salesman.  So here’s the catch:  in very, very small type hidden at the bottom of the mailing (the last line of the small-font disclaimer), Winnpointe was simply offering 15-year fixed loans to people with 30-year loans. Their rates are a touch higher than other 15-year fixed loans offered in California.  Winnpointe is offering loans where consumers spend very little out of pocket. ($495). In exchange, you pay a slightly higher market rate (currently, about 2.875% on a 15-year-loan) This is about 175 points above what other online brokers are offering. What’s that difference mean? Well, on a $400,000 loan, your monthly payment will be $2,738, whereas with the lower 2.75% loan you’d pay $2,714 each month. So over the life of the loan, you end up paying $4,320 more than if you went with the lower interest rate loan with higher closing costs. The closing costs of loans by other lenders run between $1000-$2000. So we aren’t seeing Winnpointe as offering a particularly good value proposition for savvy consumers.

We wish they’d been more honest with the consumers that they are targeting and their rates, while competitive, aren’t blowing us away.  For more information about how to refinance your mortgage, check out our article here.

23 replies
  1. jack
    jack says:

    Thanks for sharing. I just received a VERY similar format mail from Interactive Mortgage(but the fine print does list Winnpointe Corp). Everything they do is very suspicious. Why would anyone will do business with them?

    Reply
  2. Seattle-Redmond-Guy
    Seattle-Redmond-Guy says:

    Thanks for posting it. Exactly the same letter they seem to be offering 2.75 for 15years now. As of today 15year fixed refi from bankrate.com is showing 2.71% A few lenders(pacific) on bankrate.com are giving as low as 2.54

    Reply
  3. Woody
    Woody says:

    I currently have a 15-year fixed at 3.125% and these guys are offering 2.649% APR, so it’s looking somewhat attractive. (Again, as noted above, nowhere do they state the term of the loan on the advertisement, so I am assuming 15-year.) Any experiences with them on going from a 15 to their 15-year appreciated.

    Reply
  4. Paul in Woodland Hills
    Paul in Woodland Hills says:

    With a traditional full fee refinance the break even point is years out before you’ve made up for the closing costs. With a low fee refi the break even is a few months out, and with a no closing cost loan it’s immediately. You get the lower rate for cheap or free rather than a few grand. If the rates drop again you can do it over. If you decide to move you don’t eat the closing costs. Of course if it really is the bottom, and you stay in your house and won’t later refi into a shorter term, then even paying points is worth it for the lowest rate. There’s always a gamble.

    Reply
  5. Jan E
    Jan E says:

    I would think the first question someone asks after, What is the interest rate? would be What is the term? If you get scammed simply because you assume a loan term is 30 years, you should probably go with a broker. The $495 fee is excellent and, as far as I can see, the rate I was quoted is also excellent.
    The rate on my mailer of 2.625 (which was confirmed over the phone) for a 15 year fixed loan is better than any 15 year fixed rate on Bankrate.com

    I haven’t found out anything yet about their service but the guy I talked to gave me his license number and it checks out with the NMLS. He is currently licensed to conduct business as a mortgage loan originator in ca. I think I’m going to research this a little more and then call him back.

    Reply
  6. Dan Kittredge
    Dan Kittredge says:

    i’m in the process of doing a loan with them. I understand it is a 30 year fixed. they’ve locked me at 3.625% for 30yrs (on a loan amount of $567K), which is a better rate lock than i was able to find from a mortgage broker i contacted. if the rate was a little higher than average on the day that they locked me, i’m still ok with it. without that letter in the mail from them, i wouldn’t have even considered refinancing at this time, and i’m going to drop from 4.125% to 3.625% – and yes, add $8K and 5 months to my principal balance and payoff time. But i think the savings of the lower rate over the next 10 or 15 years will make it worth it…

    will re-post if anything goes to crap…

    Reply
  7. Jill Klaschke
    Jill Klaschke says:

    I am considering refinancing with this company and now I am concerned that its a scam. I read the fine print where it stated 15 year loan. The are quoting me 3.5% for a 30 year loan and basically no closing cost. I looked at bankrate.com and its shows the same interest rate for a 30 year loan so I’m confused on why the author is stating they their fees are higher. Please advise.

    Reply
    • admin
      admin says:

      There’s no evidence that this company is running a scam. Our concerns were how their advertisements weren’t making it clear that they weren’t offering 30-year mortgages and trying to explain to consumers when 15-year mortgages are (and aren’t) advisable. Their rates are somewhat competitive with some of the others on the market. You just need to be clear whether you want a 15 or 30 year mortgage.

      Reply
      • Kevin Barker
        Kevin Barker says:

        I receive the same offer in mail. After calling them and getting the rate for 30 year loan it was also 3.5% which is better than my current rate. At $495 closing cost it is a great deal. I have called several others loan companies an no one can match this (unless perhaps I get a official loan offer in writing). Yes I got hooked on the 15 year rate on the mailing but it was only a hook to call an then I ended up finding that they were indeed the best rate and would save me money after only 10 month break even!

        Reply
  8. Ellery
    Ellery says:

    I recently finished a loan with this company and had a great experience.
    I read everything and knew it was a 15 year loan, that’s what I was looking for.
    And I wanted something that was 0 cost or close because I want to pay it off in 5 years. They actually waived the $495 fee so it literally was AN ACTUAL $0 cost loan. I save money because I will not be paying long enough to repay the $1000-2000 dollars those other companies charge. This was a great option for me.

    Reply
    • admin
      admin says:

      We appreciate your sharing this information, but we think our readers should know that the email address that you provided with your “review” doesn’t check out. We sincerely hope that you are not, in anyway, connected to Experienced Refinancier (below) who submitted a similarly questionable comment using a bogus email address.

      Reply
  9. Nicusan
    Nicusan says:

    Thank you! I received the same letter from them and I thought there should be some catch with the very low fixed interest and compared with the 30 YR I have now. They knew how much I still have to pay and they put it with the BIG letters as well as the new interest. But they intentionally forgot to mention the 15 YR where they wrote big Fixed for Life of Loan. If I didn’t read this review I would have wasted my time to call them or register their website.

    They should have started saying… “If you want to pay your loan faster, we have an offer that beats any other offer…”. What do they think? All of us having 30 YR Fixed Loan we already visited the possibility of reducing the term. So they should be honest and tell us from the beginning why is this offer better.

    Reply
  10. Jon
    Jon says:

    It does seem like an attractive offer when comparing the offered interest rate to my current 30-year rate. Hiding that critical piece of information is somewhat duplicitous and would have resulted in a lot of wasted effort by me in refinancing our home. I prefer to deal with people and institutions that are straight up in their dealings.

    Reply
  11. Shawn
    Shawn says:

    Thanks for sharing this information. I received exactly the same mail from winnpinte. I was seriously considering using their loan before reading your post. You saved me a lot of trouble. Thank you.

    Reply
  12. Scott in Seattle
    Scott in Seattle says:

    What drew me to Winnpointe was the “Loan Details”
    — No Points
    — Appraisal – Lender Paid
    — Title/Escrow – Lender Paid
    — $495 Total Lender Fee
    Your thoughts on that?

    Reply
    • admin
      admin says:

      Yes, Winnpointe is offering loans where consumers spend very little out of pocket. ($495). In exchange, you pay a slightly higher market rate (currently, about 2.875% on a 15-year-loan) This is about 175 points above what other online brokers are offering. What’s that difference mean? Well, on a $400,000 loan, your monthly payment will be $2,738, whereas with the lower 2.75% loan you’d pay $2,714 each month. So over the life of the loan, you end up paying $4,320 more than if you went with the lower interest rate loan with higher closing costs. The closing costs of loans by other lenders run between $1000-$2000. So we aren’t seeing Winnpointe as offering a particularly good value proposition for savvy consumers.

      Reply
  13. Experienced Refinancier
    Experienced Refinancier says:

    Seriously? When’s the last time you looked at any of the myriad offers coming through from the various lenders? They ALL publish the 15-year rate, which is lower than the 30-year rate. That’s the hook, and if you don’t want a 15-year mortgage, don’t do it. They’ll save you money, or they won’t, but that doesn’t make it a scam.

    And yes, the BBB rating is freshly minted. They have to start somewhere. If you have an idea about how a new company can (legally) begin doing business with an established business history, please let me know! But you don’t, because the two are mutually exclusive.

    The reviews that I’ve read online, from people who have actually done business with the company, are positive. I will continue to shop around, but based on what I can see, their rate and fees are the best available. Hey, somebody has to be have the best deal, and if you’re a new company, being that front-runner is a great way to build your business!

    Reply
    • admin
      admin says:

      Our concern about Winnpointe’s messaging is that it hides the fact that it is a 15-year mortgage. In response to your suggestion that EVERY mortgage company does the same thing, we have found that reputable mortgage lenders publish both 15 and 30 year rates, as the 30-year mortgage is the predominant mortgage product on the market. You need only go to bankrate.com for verification. Further, the rates advertised by Winnpointe for the 15-year mortgage are not competitive. In our example, the broker was offering a 3.25-3.27% rate. Again, using Bankrate, we checked rates for the same product and found 10 lenders offering sub-3% loans. So your statements are simply not supported by the facts that we found and we continue to urge that reputable brokers disclose that their rates in a open and honest manner.

      Reply

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