ALLY MORTGAGES REVIEW 2024: THIS LENDER MAY BE YOUR HOMEBUYING ALLY

Vault’s Viewpoint on Ally Home Mortgages

Despite the lack of government-backed mortgages, Ally shines when it comes to the absence of lending fees and the potentially speedy approval of mortgage applications. Mortgage lending fees typically account for 0.5% to 1% of the loan amount. Plus, Ally boasts that its mortgage closing period is typically 10 fewer days than the industry standard.

One drawback to making a home purchase with Ally is that it doesn’t offer the very lowest mortgage rates, although its rates are competitive. In addition, if you’re a fan of in-person customer service, Ally isn’t the best mortgage lender for you. The online bank doesn’t operate any branches.

About Ally Mortgages

Ally’s mortgage business is part of Charlotte, North Carolina-based Ally Financial, which is the largest all-digital bank in the nation. Measured by income, Ally’s home lending operation is smaller than its auto lending and corporate lending businesses. Nonetheless, it originated $1 billion in mortgage loans in 2023.

The table below highlights Ally’s mortgage offerings.

Minimum Borrower Requirements

Before you get set on making a home purchase with Ally’s help, know that, like any mortgage lender, Ally has minimum requirements for borrowers.

One important requirement is a minimum credit score. Ally says it typically requires a minimum score of:

• 620 for a conventional loan
• 680 for a jumbo loan

Ally doesn’t offer certain types of mortgages, like FHA, VA or USDA loans.

The table below shows some of the other requirements for Ally mortgages.

How to Apply for an Ally Mortgage

To apply for an Ally mortgage, you’ll need to visit the lender’s website or call the lender at 855-256-2559 (9 a.m.-9 p.m. ET Monday-Friday, 10 a.m.-4 p.m. ET Saturday).

Because Ally is an online bank with no branches, you can’t apply for a mortgage in person.

Here are the documents and information that you’ll generally need to apply for a mortgage from Ally:

• Proof of income, such as pay stubs, W-2 forms or 1099 forms
• Two years worth of federal tax returns
• Social Security number
• Bank account statements
• Retirement account statements
• Brokerage account statements
• Statements for monthly debts such as credit card bills, auto loans, personal loans and student loans
• Proof of rent payments if you’re renting a place to live
• Divorce decree if you’ve gotten a divorce
• Verification of bankruptcy or foreclosure proceedings

How Does Ally Stack Up Against Its Competitors?

Of course, Ally isn’t the only option when you’re shopping for a mortgage. Here, we look at how Ally stacks up against two of its mortgage competitors, Rocket Mortgage and Wells Fargo.

Ally Mortgages vs. Rocket Mortgage

When comparing mortgage lenders, interest rates are a key consideration. As of April 2024, Rocket Mortgage’s interest rate for a 30-year, fixed-rate mortgage was slightly higher than Ally’s. On top of that, Rocket Mortgage charges lending fees, while Ally does not.

However, Rocket Mortgage beats Ally when it comes to certain mortgage types. While Ally doesn’t offer government-backed FHA, VA or USDA loans, Rocket Mortgage provides two of these (FHA and VA). In addition, you may qualify for a conventional mortgage at Rocket Mortgage with a lower minimum credit score (580) than at Ally (620).

Ally Mortgages vs. Wells Fargo

If you’re trying to save money on interest, Wells Fargo may be a better bet than Ally. As of April 2024, Wells Fargo’s interest rate for a 30-year, fixed-rate mortgage sat below Ally’s. Also, Wells Fargo bests Ally in terms of government-backed mortgages. Wells Fargo offers FHA and VA loans, while Ally provides neither.

But compared with Ally, Wells Fargo doesn’t have the best track record when it comes to handling mortgages. In 2022, the Consumer Financial Protection Bureau ordered Wells Fargo to pay $3.7 million for “widespread mismanagement” of mortgages, auto loans and bank accounts. Just one year earlier, the U.S. Office of the Comptroller of Currency slapped Wells Fargo with a $250 million penalty over “unsafe or unsound practices” in its mortgage business.

Another knock against Wells Fargo: The banking giant announced in 2023 that it was shrinking its mortgage business. One outcome of this decision is that Wells Fargo now focuses on extending mortgages only to customers who already have a relationship with the bank.