For banks, credit unions and other small-business lenders, this is an IRS-related story with a happy ending — kind of.
Responding to a determined lobbying campaign by a broad consortium of financial services trade groups, the U.S. tax-collection agency has agreed to suspend a policy change that would have blocked small-business lenders from accessing borrowers’ income data through its Income Verification Express Service.
“We acknowledge the concerns raised and are assessing our ability to provide return information when necessary while keeping taxpayer information confidential and protected from disclosure,” the IRS wrote in a March 6 policy update statement. “Although IRS announced the policy change on January 2, 2024, we are suspending that change as we seek input from you and other stakeholders on possible changes and impacts to the program.”
Scott Stewart, CEO of the Innovative Lending Platform Association, acknowledged that the IRS could revert to its original policy stance after its review. At the same time, even a temporary respite represents a major achievement, Stewart said.
“Federal agencies don’t do this,” Stewart said in an interview. “To get a federal agency of any kind, let alone the IRS, [to acknowledge a misstep] is really exceptionally rare. I don’t know if I’ve ever seen a reversal like this. The IRS deserves credit for realizing this policy requires further review.”
The Innovative Lending Platform Association was one of 11 financial services industry trade groups, including the Independent Community Bankers of America, American Bankers Association, America’s Credit Unions and the Mortgage Bankers Association, that endorsed a Jan. 24 comment letter opposing the IVES policy change. IVES is the platform that lets taxpayers give third parties — like lenders — permission to see tax return or wage information.
Under the IRS’ original concept, it would have delivered tax data only to lenders making mortgages. In all other instances, the agency would have delivered the data directly to individual taxpayers to protect their privacy.
Lenders value the ability to obtain tax returns from the IRS as a critical tool in underwriting and preventing fraud. They were concerned the policy change would add complexity, time and cost to applications while at the same time making it easier for bad actors to game the system.
“You could see how fraudsters might just digitally alter their tax returns and they could send it off to the lender,” Stewart said. “I hope they’re going to move toward [opening] the system in an [application programming interface] fashion so that everyone can get access and overall lower the cost of credit and capital for small businesses, consumers, people looking for insurance — everybody.”
An application programming interface, or API, is software code that allows a website, application or program to more easily share information with other websites, applications or programs.
In their announcement last week, IRS officials “said they were suspending the decision indefinitely,” Ryan Metcalf, head of public affairs for Funding Circle US, said in an interview. “I’m not concerned it’s coming back. It seems like the IRS has backed off. … This is a huge win for American consumers and small businesses.”
It’s far from game over, though.
“It’s good news [the IRS] has returned to the status quo,” Metcalf said. “We still have issues to resolve. We still have to work out how we resolve the authentication issue, can we have private APIaccess to log in, can we expand the data in the transcript — all of those things we’re still seeking are outstanding.”
Beyond access to tax data, lenders and borrowers want the IRS to make it easier to use IVES. Currently, borrowers have to create IRS accounts and verify their identities with the agency before they can request that a transcript be delivered to a lender. That route is time-consuming and redundant, since the lenders themselves are required to verify identity under know-your-customer requirements, Metcalf said.
“The [optimal] outcome is we want a borrower to be able to submit a [transcript request] to the lender, the lender hands that to the IRS and we get the tax return in real time,” Metcalf said. “Or, if the lender has an account with the IRS already, they should just be able to log in to that account in our application. That’s the API access. … That’s what we want. We want that optionality of either/or.”
Bipartisan legislation introduced in the House of Representatives in May 2023 would address the authentication issue by enabling taxpayers to designate a financial institution or other service provider to receive tax data. The bill, introduced by North Carolina Republican Patrick McHenry, chairman of the House Financial Services Committee; California Democratic Rep. Jimmy Panetta; and Colorado Democratic Rep. Brittany Petterson, is currently under consideration by the Ways and Means Committee.
Funding Circle backs the legislation as it is currently written and is hoping to strengthen its language in the wake of the IRS’ action. “We’re getting ready to update that bill to address additional issues. … We would probably add on to it to make sure the IRS doesn’t revisit this policy decision,” Metcalf said.
The IRS didn’t respond to a request for comment at deadline.
Stewart attributed the IRS’ initial policy restricting IVES access to a desire to protect taxpayer information. “Their duty is paramount,” Stewart said, but he was quick to add that allowing API interface with IVES could be accomplished without compromising data integrity. “We don’t think creating this API is going to do anything to endanger the taxpayer, as long as you have them making the request directly through the lender or the insurance company or the bank.”
This story has been updated to add New York Community’s closing share price on Wednesday, as well as to note that the bank amended its investor presentation after the market closed to include guidance on net interest income in 2024.
January 31, 2024 5:44 PM EST
This story has been updated to add New York Community’s closing share price on Wednesday, as well as to note that the bank amended its investor presentation after the market closed to include guidance on net interest income in 2024.
Minority-owned banks and credit unions, classified as Minority Depository Institutions (MDIs) by government agencies, are financial institutions where most board members or stockholders are people of color.
MDIs play a crucial role in helping underserved communities. While such institutions don’t solely lend to minorities, they tend to provide more loans and accounts to minority communities than non-minority-owned banks do, according to data from the Federal Deposit Insurance Corp. This is particularly important because members of minority communities, like African Americans, often lack access to financial services and are typically underserved by financial institutions.
Supporting Black-owned or Black-led financial institutions and lenders by doing business with them can help minority communities economically.
Black-owned and Black-led auto lenders
Note that the lenders are listed alphabetically.
Adelphi Bank
Primary location(s): Columbus, Ohio
Good for: Borrowers in Franklin County, Ohio, who want to bank with an institution that empowers the local community. Note that Adelphi is a newer institution that primarily provides commercial lending and, according to a spokesperson for the bank, has only approved a handful of auto loans thus far.
Alamerica Bank
Primary location(s): Birmingham, Alabama
Good for: Residents of Birmingham, Alabama, with great credit scores. Alamerica only provides auto loans under exceptional conditions, and applicants must have good credit scores to apply. The bank does not offer prequalification and does not provide refinance loans.
Andrews Federal Credit Union
Primary location(s): Maryland, New Jersey, Northern Virginia and Washington, D.C.
Good for: Military service members based on the East Coast. The credit union also serves nonmilitary personnel who meet other eligibility requirements, like working for one of its employer groups. In addition to loans for traditional vehicles, AFCU offers financing for new and used boats, motorcycles and recreational vehicles (RVs).
Citizens Trust Bank
Primary location(s): Alabama and Georgia
Good for: Veterans and first-time car buyers in Alabama and Georgia. Citizens also offers auto refinance loans. While any U.S. resident can apply for a credit card with the credit union, only residents of Georgia or Alabama can apply for consumer loans, like auto loans, through the institution.
Commonwealth National Bank
Primary location(s): Mobile, Alabama
Good for: Residents of Mobile, Alabama, who want to borrow from a local institution. The bank provides loans for all borrowers, with a particular focus on serving its historically underserved African American community. Commonwealth National Bank offers vehicle loans for up to 90% of the vehicle’s value, according to a spokesperson for the bank, and also offers auto loans for motorcycles, motor homes, campers, travel trailers, boats, personal water-crafts and more.
Democracy Federal Credit Union
Primary location(s): Maryland, Virgina and Washington, D.C.
Good for: Borrowers in the D.C. metro area who want a variety of auto loan options and the benefits of credit union membership. In addition to new and used purchase loans, the credit union offers refinance loans and lease buyout loans. Democracy also offers additional benefits like GAP insurance and an auto advantage program that extends borrowers’ manufacturer warranties.
First Independence Bank
Primary location(s): Detroit, Michigan, and Minneapolis, Minnesota
Good for: Detroit or Minneapolis applicants seeking a preapproved car loan with a local bank.First Independence provides car loans as well as financing for recreational vehicles like campers, motorcycles, motor homes, snowmobiles and travel trailers.
First Security Bank and Trust Company
Primary location(s): Oklahoma City, Oklahoma
Good for: Auto loan borrowers in Oklahoma City who want to support the institution’s mission of serving minority communities in the area. The bank gives new and used car loans, as well as refinancing loans.
Primary location(s): Chicago, Illinois
Good for: Individuals who live in Chicago’s South Side community. The bank’s website notes that it aims to serve communities outside of Chicago, in Illinois and nationwide, in the future.
Hope Federal Credit Union
Primary location(s): Alabama, Arkansas, Louisiana, Mississippi and Tennessee
Good for: Borrowers in these southern states with limited or no credit history looking for flexible auto loan terms. Hope also provides financing for RVs, boats and all-terrain vehicles.
Good for: Borrowers in primary locations that the bank serves seeking flexible new and used-car auto loans. Consumers can apply for a Liberty auto loan online or at a local branch. Some of the bank’s auto loan features include the ability to make fixed monthly payments, no prepayment penalty and a credit decision within hours of application.
Mechanics & Farmers Bank
Primary location(s): North Carolina
Good for: North Carolina borrowers who want to buy new or used cars between $7,500 and $75,000. The bank also offers auto loan refinancing. M&F has an “Outstanding” Community Reinvestment Act (CRA) rating from the FDIC, which means that it has maintained a record of meeting the needs of the low to moderate-income communities that it serves.
Municipal Employees Credit Union
Primary location(s): Maryland
Good for: Auto loan applicants in the greater Baltimore region wanting the convenience of an online car buying service and the benefits of credit union membership. Municipal members can use its online vehicle shopping service AutoSMART to search for and compare new and used cars at dealers near them. The credit union provides financing for new and used cars, as well as auto refinance loans.
Optus Bank
Primary location(s): Columbia, South Carolina
Good for: South Carolina residents, particularly those who are historically underserved people and those who were previously unbanked or underbanked.
SecurityPlus Federal Credit Union
Primary location(s): Baltimore and Ownings Mill, Maryland
Good for: Applicants who want flexible auto loan terms and rate discounts. The credit union provides new and used car loans with loan terms ranging from less than 12 months up to 84 months. SecurityPlus also features a 0.25% APR discount for setting up automatic payments.
St. Louis Community Credit Union
Primary location(s): St. Louis County, Missouri
Good for: Applicants in St. Louis County seeking a variety of auto lending options. The credit union offers new and used car loans, both external and internal refinance loans, as well as cash-out refinancing, private party loans and lease buyout loans.
Unity National Bank of Houston
Primary location(s): Texas and Georgia
Good for: Individuals in the bank’s service areas who want a preapproved auto loan from a local institution.
Methodology:We created this index of auto lenders based on lists of “minority depository institutions,” or MDIs, from the Federal Deposit Insurance Corp. and the National Credit Union Administration. The FDIC considers a bank or financial institution to be a MDI if at least 51% of its stockholders are “minority individuals” or most of its board of directors and the community it serves are minorities. The NCUA considers a credit union to be a MDI if more than 20% of its current members, board members and community it serves are Asian American, Black American, Hispanic American or Native American.
The housing market may have its ups and downs, but one thing never changes: Families need a place to call home, a place where memories can be made every day. The Bank of the Pacific home loans team does more than just crunch numbers or sift through the many paperwork-heavy steps of pre-qualification, purchase and closing. They strive to build lasting relationships that extend generations.
Through Thick and Thin, Bank of the Pacific Helps Find Your Dream Home
Bank of the Pacific works with families from Lynden, Washington, in the north to Salem, Oregon, down south. They know many factors drive home purchases and that, like families, no two are the same. When we’re just starting out, we often look for simple, family-friendly properties in welcoming neighborhoods with sidewalks and parks. As we get a little older, it’s time to either downsize into something manageable during retirement or invest in a multigenerational property everyone can share. Some look for real estate bargains to restore and flip, others for investment properties to provide extra income. Whatever your needs, Bank of the Pacific is happy to help.
Michael Lombardo is Bank of the Pacific’s Director of Residential Lending. Though he’s only been with their team for the past two and a half years, he’s been in the industry for more than three decades. Lombardo has a background in lending, real estate, securitizations, loan portfolio management, and culture change management. This experience and expertise mean your unique journey is in good hands.
Community Banking Builds Trusted Partnerships
Lombardo says that what sets Bank of the Pacific apart in a crowded financial field is their caring, knowledgeable staff and scope of services provided. “We are not transactionally focused,” says Lombardo, “we are community bankers that believe we are building relationships for the long term. Repeat business and referrals are a primary source of business, therefore, we strive to be trusted partners and hire people who believe in that mission.”
Their specialists are always ready to talk you through home purchases, refinancing options, new home construction or home equity loans. You can get started online or call, visit, text or email a team member to begin the process. “We always want to meet people,” says Lombardo, “and the most important thing is that our customers know a real person is working for and with them the entire way.”
Advice from Real Estate Lending Pros at Bank of the Pacific
The past few years have been a housing market whirlwind. Prices and interest rates fluctuate daily, and a shortage of available homes means new listings are snapped up within hours. Lombardo acknowledges that “as much as the government has tried to curb inflation by raising interest rates, it hasn’t had the desired effect on real estate in our markets. Affordability is an ongoing challenge for people seeking home ownership and market volatility and uncertainty forces lenders like us to work to find creative loan programs that help credit-worthy buyers get into a home.”
He advises hopefuls to be prepared, save paystubs and files — ideally as PDF documents for ease of attaching to an email — and plan 12 to 24 months in advance. “Pre-qualifying is the same as applying for a loan,” says Lombardo, “and it can feel overwhelming with lots of paperwork and document requests. Stay organized so you can react quickly when rates begin to decline, set goals for yourself, talk to a mortgage lender and ask a million questions. A good lender will always take the time to help you.”
At Bank of the Pacific, you can begin the application online and one of their home loan specialists will get back to you within 72 hours. Otherwise, find the specialist in a branch location nearest you and reach out directly with questions or to make an in-person appointment.
If you’re new to Bank of the Pacific’s many services, take a moment to investigate their competitive checking and savings accounts, investment options, merchant services for small businesses, commercial lending or real estate and helpful financial calculators.
Home buying is still one of the largest purchases most people ever make. But though it may seem out of reach, don’t be daunted. At Bank of the Pacific, lenders like Lombardo will make sure you’re comfortably prepared well in advance and ready to act when the right property comes along. Because when it does, you can start the next phase of life with a celebratory welcome mat and dreams for the future.
Enjoy complimentary access to top ideas and insights — selected by our editors.
The top five lenders in the ranking have an average total origination volume of more than $7 billion as of the end of the second quarter of 2023. Most lenders saw an increase in volume between Q1 and Q2, with one logging a rise of 94.81%.
Scroll through to see which residential lenders are in the top 20 and how they fared through the end of June 2023.
Banks are facing substantial risk of losses from commercial real estate loans, according to a new Moody’s survey of lenders, which found that some borrowers are already struggling and others may hit trouble when more of their loans mature.
The survey’s findings also suggest that some banks may not be tracking CRE borrowers’ health as closely as others — since they weren’t able to provide fully up-to-date metrics when asked.
The lack of timeliness in some banks’ disclosures was “eye-opening,” said Stephen Lynch, senior credit officer at Moody’s Investors Service. Up-to-date data about commercial property values and borrowers’ ability to cover their interest payments is critical for spotting potential problems, Lynch said.
“Good underwriting can maybe compensate for subpar portfolio analytics,” Lynch said, but strong analytics give banks the ability to mitigate problems early, rather than the often-costlier option of letting them bubble up.
The survey drew responses from 55 banks — including large, regional and community banks — in June and July. Since banks’ public disclosures are somewhat limited, Moody’s asked the respondents to provide more detail about certain key metrics.
Those measures include the percentage of CRE loans maturing soon; debt service coverage ratios, which show borrowers’ debt obligations relative to their cash flow; and loan-to-value ratios, which quantify the amount of debt outstanding as a percentage of the property’s value.
Some banks provided up-to-date data, while others submitted information from the end of 2022.
The Moody’s survey found that U.S. banks have significant amounts of CRE loans that will mature in the next 18 months. For the median bank that responded, those loans amounted to 46% of their tangible common equity — a percentage that Moody’s said was material. Some banks were substantially above that figure.
Upcoming maturities may pose problems for borrowers because they’ll need to refinance those loans, and they’ll need to do so at much higher interest rates and with banks being more demanding in their underwriting criteria.
Properties whose values have fallen sharply may get some help from providers of private capital, which can kick in additional equity to help property owners meet banks’ more stringent criteria. But the amount of money available likely isn’t going to “move the needle,” given the large amount of loans outstanding, Moody’s Lynch said.
While private equity firms, hedge funds and other sources of private capital may see opportunities to jump in, they are “not going to solve every problem,” said Brendan Browne, an analyst at the ratings firm S&P Global. Private money will help where companies see a chance to make significant returns, but there will also be cases “where the economics probably just don’t work well enough,” Browne said.
Overall, banks will feel “some pain” on CRE loans — particularly banks with larger exposures to the sector, Browne said. Most of the banks that S&P rates don’t have such outsized exposures, he added.
The Moody’s survey pointed to office and construction loans as the riskiest property types, given the shift at some companies toward remote work and the fact that properties that serve as collateral for construction loans don’t earn income while those loans are outstanding.
A loan may be at greater risk now if the borrower is having a tougher time paying its obligations. So Moody’s asked banks about how many of their loans have debt service coverage ratios below 1, an indication that the borrower does not have adequate cash flow.
The median respondent has 13.5% of its tangible common equity in CRE loans where the debt service coverage ratios are below 1, Moody’s survey found.
That figure was higher than Moody’s expected, Lynch said.
A top bank isn’t always the highest flier, but one that can survive the tough periods in a more turbulent economy.
That’s the story of Gateway First in Jenks, Oklahoma, the No. 1 bank on the 2022 list of top-performing banks with $2 billion to $10 billion of assets compiled by the consulting firm Capital Performance Group. The list ranks the banks by their three-year average return on average equity. The $2.1 billion-asset Gateway’s three-year average ROAE of 25.36% put it at the top of the list.
But compared to its top-performing peers that hovered in the 20% to 30% range in the last three years, Gateway First had a very different journey. Its ROAE was slashed in half from 2020 to 2021, going from 45.66% to 26.58%. This then plummeted down to 3.84% in 2022.
“I don’t think there’s any company I’ve seen that has been through more change in the last five years than we have,” said Scott Gesell, CEO of Gateway First Bank. This included changes brought on by an acquisition and a change in strategy.
“But we’ve weathered the storm,” Gesell added. “And it’s because we got great people.”
The bank, originally an independent mortgage company called Gateway Mortgage Group, acquired Farmers Exchange Bank and became Gateway First Bank in 2019. Gateway First’s dominance in the mortgage market proved to be a boon during the pandemic when rates were cut in an attempt to spur economic activity. In 2020, the 30-year fixed-rate mortgage fell below 3% for the first time, and then hit an all-time low of 2.65% in January 2021.
Gesell noted that those were some of the “best years in the history of mortgage lending.” The bank’s mortgage loans peaked at $11.8 billion dollars in the middle of 2020, he added.
Then came the end of 2021, when the bank’s mortgage loans fell to only $4 billion. “It was a transition year away from that and into kind of the worst year in mortgage banking, probably since 2008,” he said.
Interest rates have spiked to more than 7% this year. Ninety-nine percent of borrowers had a mortgage rate lower than 6% or the current market rate, according to Goldman Sachs earlier this year. This has deterred refinancing, with the number of these loans dropping from 1.8 million in the first quarter of 2021 to just 9,700 in the fourth quarter of 2022. Gesell called it a “perfect storm in the mortgage industry today.”
Gateway has made efforts to diversify its balance sheet by racking up more commercial loans while maintaining and monitoring its current mortgage portfolio. Gesell highlighted that mortgage banking is a more “fickle and volatile business” than other lines of business.
Steven Reider, president of the consulting firm Bancography, said that facing a dearth of refinancing and mortgage activity, it’s good for a bank to look for other revenue streams.
“There’s a benefit from diversification because all of our business lines and all our economic sectors don’t tend to move in lockstep,” he added. “But it takes time to build the product. It takes time to build the personnel.”
The industries of Gateway’s commercial loans are diverse, according to Gesell, ranging from hospitality to energy lending. Meanwhile, the bank has steered clear from lending on commercial office real estate given the uncertainty of that business right now. Remote work has persisted since the pandemic, and office vacancies have reached an all-time high at 16.1% in the first quarter.
Besides diversifying its loan portfolio, the company also cut operations and staffing since the mortgage boom ended. The company cut its number of mortgage centers from 170 to 125 and trimmed its headcount from 1,800 employees who work on mortgage originations to 1,100.
“It’s a tough deal but people know that we aren’t doing it lightly,” added Gesell. “The nice thing is we had a couple good years that allowed us to buffer and soft-land the process of downsizing.”
Gateway’s near-future growth strategy will continue to focus on commercial lending, while fortifying its deposit base — the bank currently has one of the highest loan-to-deposit ratios in the top-performing banks ranking at around 140%. Gesell said that they will be able to do this through organic customer growth and acquisitions of banks heavier on deposits than loans. He is aiming to decrease Gateway’s loan-to-deposit ratio to 90% by the end of 2024.
“That’s sort of been the history of the organization. There has been a commitment to reinvesting in the organization on an ongoing basis because you want to maintain yourself in a position to continue to grow,” said Gesell.
Academy Mortgage recently celebrated its 30th anniversary, having been founded back in 1988.
It began as a humble family-owned company opened by Duane Shaw, and remains one today with his son-in-law Adam Kessler in charge, serving as CEO.
With three decades under its belt, it’s clear Academy is a mature player in the mortgage space, which now includes all types of fintech-focused newcomers like Better Mortgage and Movement Mortgage.
It’s a very competitive business, so those who are able to stick out it for so long have proven staying power if nothing else. They must be doing something right, right? Let’s find out.
Academy Mortgage Prides Itself on Doing Everything In-House
They are an independent direct mortgage lender based in Utah
That only operates via the retail direct-to-consumer channel
Licensed to do business in 49 states and DC (not licensed in NY)
Have over 260+ branch offices nationwide
The Draper, Utah-based company’s claim to fame is that it’s a direct lender “100% focused on retail mortgage banking.”
What it means is they only work with borrowers directly, instead of dabbling in the correspondent or wholesale channels. So they’re laser-focused on the customer.
Perhaps this is how they were able to navigate through the mortgage crisis that occurred in the early 2000s, only to grow bigger and stronger since then.
Additionally, they do all the loan underwriting, processing, and funding in-house, instead of having a fragmented sales and operations team offsite.
Everything is carried out in one of their 260 branch offices throughout the country. Speaking of, they’re licensed to do business in 49 states and Washington D.C.
Some of those branches were the result of their acquisition of Republic Mortgage back in 2014, which allowed them to grow to 200 branches and 2,100 employees.
In 2017, they also acquired Oklahoma-based First Mortgage Co., which operated many branches in the Southwestern United States and Texas.
They also pride themselves on quick turn times, and refer to themselves as the “Gold Standard” in loan origination.
So it’s obvious that customer satisfaction reigns supreme with the company.
Getting a Home Loan with Academy Mortgage
The company employs hundreds of loan officers nationwide
You can call them directly to get paired up with an employee
Or visit their website and use their online directory to choose someone specific
It’s also possible to visit one of their many branches if you prefer face-to-face interaction
The company employs thousands of individuals, including a large fleet of mortgage loan officers throughout the country.
If and when you apply for a home loan with Academy, you can call them directly or choose a specific loan officer to work with.
They have a loan officer directory on their website that allows you to search by zip code, by name, and by branch (city and state location).
I imagine many of the loan officers are referred to clients, either by a real estate agent, or by a former customer who had a good experience with the company.
You can also visit a branch if face-to-face is your thing, though these days folks seem more interested in using a smartphone to make contact.
The one downside here is it appears that you can’t apply for a mortgage online.
Academy Mortgage a Top-40 Mortgage Lender
They’re a top-40 mortgage lender nationwide
The company closed more than 35,000 mortgages in 2019
The majority of those loans were for home purchases (about 70%)
With the remainder tied to home refinance transactions and HELOCs
Based on the latest HMDA data, Academy Mortgage was the 37th largest mortgage lender overall in the nation based on total loan volume in 2019.
The company closed 35,000 residential mortgages throughout the year on nearly $9.5 billion in total loan volume.
While that’s fairly big, it pales in comparison to Quicken Loans, which mustered over $81 billion during the same time period. However, it shows they’re no slouch either.
For home purchase loans, they tend to rank in the top 20 nationally since a large share of their mortgages are for that purpose.
For home refinance loans, they rank quite a bit lower due to lower volumes, but they’ve still got plenty of options for borrowers either way.
But it is clear that the independent home loan lender focuses heavily on home purchases as opposed to refinances, likely partnering up with local real estate agents to generate business.
Academy Mortgage Interest Rates
They don’t disclose their mortgage rates on their website
So it’s impossible to know where they stand without getting a quote first
My guess is their rates are average relative to other mortgage lenders
If super low they’d probably openly advertise them to draw in business
Unfortunately, the company doesn’t advertise their mortgage interest rates anywhere online. So it’s impossible to know how competitive they are pricing-wise.
If we consider the fact that most of their loan volume comes from purchases as opposed to refinances, we could guess that their mortgage rates probably aren’t super competitive.
Or at least not necessarily lower than the competition. After all, if they had the lowest price out there they’d probably want to advertise it, or at minimum make it known somewhere.
My guess is their rates are run-of-the-mill, but again, that’s just speculation.
If you do include Academy in your mortgage loan search, be sure to compare rates and closing costs to other lenders to see where they stand.
What Academy Mortgage Offers
The company offers a variety of home purchase and refinance solutions
Including conventional, jumbo, FHA, VA, and USDA options
You can get any number of fixed or adjustable-rate products
And even a zero down home loan via their exclusive GSFA Platinum Program
The company calls itself a “top-tier lender” when it comes to purchase loans, FHA loans, and builder loans.
This includes home purchase loans, refinance loans, renovation loans, and streamline refinance options.
You can get the basic Fannie Mae and Freddie Mac-backed conventional loans that allow for down payment as low as 3%.
They come in a variety of fixed-rate options, including 30-year, 25-year, 20-year, 15-year, and 10-year terms. That’s typically more choices than most lenders offer.
Academy also offers the usual adjustable-rate mortgage options, including a 10/1 ARM, 7/1 ARM, 5/1 ARM, and 3/1 ARM.
If you’re interested in a government home loan, they offer all the usual suspects including FHA loans, VA loans, and USDA loans, including FHA 203k renovation loans and FHA Energy-Efficient Mortgages.
It’s also possible to get a zero down home loan if you’re a first-time home buyer via their so-called exclusive GSFA Platinum Program, which includes a grant for up to 5% of the loan amount to cover down payment and closing costs.
The grant funds, which are provided by the Golden State Finance Authority, aren’t required to be paid back if certain conditions are met.
Lastly, they offer jumbo home loans up to $1.5 million loan amounts, with down payment requirements as low as 10%.
You may also be able to avoid PMI even when putting just 10% down!
Academy Mortgage Also Offers Commercial Loans
While they only operate a retail channel for residential mortgages
They do have a commercial lending division as well
It offers a very wide range of commercial and small business loans for commercial and multi-family properties
It should be pointed out that the company also offers commercial loans via a separate lending division.
Their offerings range from life insurance company loan programs to Fannie Mae and Freddie Mac programs for apartment buyers.
They also offer conduit loans and conventional loan programs for those wishing to purchase a commercial property.
Additionally, they offer multi-family loan programs, including those backed by the FHA/HUD, along with construction and bridge loans.
Lastly, you can get your hands on a variety of Small Business Administration (SBA) loans, including the SBA 7(a) Program and the SBA 504 Program.
So the appear to have you well covered if you need a commercial loan for just about any purpose.
The Verdict on Academy Mortgage
What they appear to lack in technology might be more than made up for by their excellent customer service
They have a near-five star rating on Zillow (4.96 out of 5 at last glance)
Which is even more impressive based on the many reviews completed (nearly 25,000!)
So if you want a great home loan experience they might be a great fit
While they seem to be a good lender on paper, with both high marks on customer service and awards for being a great place to work, we don’t know much about their rates and fees.
For those interested in securing the lowest-cost mortgage, some more digging and comparing will be necessary to see if they’re the right choice.
Academy doesn’t highlight any technology either, which seems to be a major factor these days for a lot of consumers.
There’s no mention of a digital or paperless process, a smartphone app, or anything really on that front. That’s not to say it doesn’t exist, but chances are if it did, it’d be emphasized.
But they’re a top-20 home purchase loan lender, which that says something, especially since they don’t seem to advertise very much.
Perhaps the service speaks for itself, and they receive a lot of referrals from past customers and real estate agents.
They have an excellent rating on Zillow, with 4.96 stars out of 5 on nearly 25,000 reviews at last glance.
Wells Fargo is taking bigger precautions on its office building loans, setting aside more funds to cover potential losses as the sector continues to deteriorate.
The office market “continues to be weak” in many cities, Chief Financial Officer Michael Santomassimo said Friday. But he also argued that general trends can be misleading, and said the bank has been doing a property-by-property analysis to see where its specific risks lie.
The warning from one of the country’s largest banks hints at signs of trouble that smaller banks may share as they start reporting earnings next week. Office loans make up about 3% of Wells Fargo’s total loans, but many smaller lenders have bigger concentrations.
Wells, which has $1.9 trillion of assets, continued to conduct a deep dive into its office loan book in the second quarter, which prompted it to set aside more reserves to absorb potential losses later on.
After stress testing its commercial real estate loans, the bank’s allowance for credit losses in the CRE sector jumped to $3.6 billion in the quarter — up 64% from a year earlier. Office vacancy rates have climbed as remote work has shown staying power.
Wells Fargo executives, who also boosted CRE loan reserves in the first quarter, didn’t rule out adding more reserves as conditions evolve. But they said their current analyses covered just about every risk they can see at the moment.
“We’ve gone through a number of stress scenarios and feel like at this point, we’re appropriately reserved,” Santomassimo said on the bank’s second-quarter earnings call.
JPMorgan Chase also bumped up its reserves during the quarter due to office loans, though its executives cautioned against reading too much into the buildup, given the bank’s limited exposure to the office sector. JPMorgan Chief Financial Officer Jeremy Barnum said the company wanted to get “ahead of the cycle,” but he noted that most of the bank’s CRE portfolio is tied to loans backed by multifamily buildings.
Wells Fargo and other large banks have manageable exposures to office buildings and other commercial real estate, said CFRA research analyst Kenneth Leon, pointing to the resilience those banks showed in this year’s stress tests. Leon credited Wells executives for displaying strong “credit risk control” and closely monitoring its CRE loan portfolio.
Wells Fargo’s CRE team is focused on “surveillance and de-risking,” Santomassimo said. The bank highlighted diversification in its portfolio, with an investor presentation showing that office loans make up 22% of its CRE book.
Loans backed by apartments, a sector that Santomassimo said is performing “quite well,” account for 26% of Wells Fargo’s CRE book. Warehouse, hotel and retail loans make up smaller chunks.
Nearly a third of Wells Fargo’s office loans are in California, and the remainder are spread across several other states. San Francisco, where Wells is headquartered, has been a source of worry in the office market, given that tech companies have embraced remote work more than many other firms. One office building there has reportedly seen an 80% drop in its value.
Asked about office-related risks in California, Santomassimo said that worries are not “isolated to California” and “you see weakness in a lot of cities these days.” He also cautioned against focusing solely on geography.
“Even in California, we’ve got as many examples where clients are actually reinvesting in buildings, even if lease rates are low or even empty in some cases, as they are going into a workout,” Santomassimo said.
Wells CEO Charlie Scharf said it’s “a very big mistake” to think that a building’s geographic location is the only factor that will determine whether losses occur.
“We have examples in cities that are struggling where the structure of our loan is quite good — the underlying property has very high lease rates for an extended period of time,” Scharf said. In markets that are doing well, specific properties may be at more risk due to a large amount of upcoming lease terminations, he added.
“That’s the level of detail that we’ve used to come up with what we think the appropriate level of reserving is,” Scharf said. “We’ve tried to be as diligent as we can.”
If you live or work in Delaware, it’s important to find the right bank for your unique goals. Fortunately, there are plenty of options at your disposal.
In addition to its beautiful beaches, affordable housing, and historical landmarks, the First State is home to many reputable banks that are member FDIC for your peace of mind and ideal for your personal or business finances.
13 Best Banks in Delaware
While some have local branches throughout the state, others are online only. To make your search for the ideal financial institution a bit easier, we’ve done the heavy lifting for you and listed the best banks in Delaware below.
1. The Bank of Delmarva
The Bank of Delmarva is a small community bank with branches in Ocean City, Salisbury, and Sussex County. Its lineup of personal banking accounts and services includes the best checking accounts, savings accounts, money market accounts, CDs, and IRAs.
If you’re a small business owner, rest assured that it offers business loans, commercial products, and merchant services. Compared to other banks in the state, it offers low fees and competitive interest rates. Plus, it’s earned stellar reviews for its customer service. We can’t forget the intuitive mobile app you can use to manage your banking while you’re out and about.
2. Chime
Chime is a digital bank redefining traditional banking norms. With no physical branches, Chime stands out by providing a simple yet intuitive suite of financial products, all managed from their highly rated mobile app. The bank offers a fee-free1 checking account, a savings account, and a secured credit card.
The checking account, with no minimum balance and no overdraft fees, is particularly impressive. Its standout feature, SpotMe5, allows qualifying users to overdraw by up to $200 without fees. Meanwhile, the savings account is made appealing with an automatic savings feature, making it simple to save without thinking.
Notably, Chime gives the benefit of receiving paychecks up to two days early2 with direct deposit setup, a major plus for budgeting and financial planning. Its secured credit card is also a boon, helping users build credit over time through responsible usage and consistent payments.
3. TD Bank
TD Bank is a solid pick for a national bank with a handful of locations in the First State. With TD Bank, you can expect a plethora of products and services, no fees on international transactions, and a highly rated mobile banking app.
From personal and business checking accounts and savings accounts to personal loans, IRAs, and mortgages, TD Bank truly offers it all. If you open an account, you might qualify for a generous bonus. Also, if you’re a student or young adult, you won’t have to worry about monthly maintenance fees or service fees. You might also be able to waive these fees if you maintain a high balance in your accounts.
4. M&T Bank
M&T Bank has many locations in Delaware in cities like Wilmington and New Castle. Even if you don’t live in an area with a physical M&T location, you can enjoy digital banking and conveniences like Zelle transfers and mobile deposits. When it comes to checking accounts, M&T Bank offers four options.
The EZ Choice Checking is your best bet for a basic, free checking account while MyWay Banking is a checkless account that doesn’t charge overdraft fees. MyChoice Plus is an interest-bearing account, just like MyChoice Premium, which offers competitive rates on loans and other products.
In addition to these noteworthy checking accounts, you’re sure to appreciate M&T’s large ATM network and no monthly fees.
5. Artisans’ Bank
Artisans’ Bank has served Delaware since 1861. Today, it has 12 branch locations in the First State as well as two commercial lending offices. Artisans’ list of personal banking products includes checking accounts, savings accounts, money market accounts, debit cards, and branded credit cards with cash back rewards.
The bank also serves small businesses in Delaware with small business banking products such as business bank accounts, business credit cards, and business loans. Even though Artisans’ is a local bank with a physical presence, it offers online banking services so you can manage your accounts online.
6. Capital One
Capital One is a large bank with a reputation for no minimum deposit requirements or monthly maintenance fees. While there are no Capital One branches in Delaware, the bank is worth considering if you prefer online banking. You can apply for and manage personal and business accounts online.
Speaking of accounts, its flagship account is the 360 Performance Savings that makes it a breeze to earn interest on your hard earned money. In addition to an impressive interest rate, there is no minimum balance required so you can open an account with any amount. Other perks there is a highly rated mobile app and free credit card monitoring.
7. Axos Bank
Axos Bank is a digital bank with competitive interest rates on checking and savings accounts, which are free of monthly fees and ATM fees. Even if you live in Delaware, you can perform your banking through Axos online or via the intuitive mobile app, which comes with mobile check deposits, fund transfers, and mobile bill pay.
The bank’s checking accounts offer rewards while the savings accounts stand out for their ATM cards. Speaking of ATMs, Axos Bank will reimburse you for ATM fees on many of its accounts. In addition to its personal banking products, Axos specializes in new mortgages, mortgage refinancing, HELOCs and home equity loans, car loans, personal loans, and managed investment portfolios.
8. Barclays Bank
Barclays Bank operates in Wilmington. It’s a global bank that serves all U.S. states with several banking products. Even though there is only one branch in Delaware, it offers an online portal and a highly rated mobile app so you can bank from anywhere.
As a customer, you’ll enjoy benefits like a high interest rate on high-yield savings accounts and CDs. If you do open a CD with Barclays, you’ll also reap the benefits of low withdrawal penalties. In addition, the bank’s customer service line is available seven days a week to answer any questions or concerns you might have.
9. Community Bank Delaware
Community Bank Delaware is exactly what it sounds like: a community bank based in Delaware. Since it’s locally owned and managed, it focuses on personalized customer service and community support.
At this bank, you’ll find checking accounts, personal savings accounts, time deposits, personal loans, personal credit cards, mortgages, and home equity loans. Community Bank also serves local small business owners with products to support their business operations, such as checking accounts, business savings accounts, business credit cards, and merchant services.
Additional banking solutions include online banking, wire transfers, cashiers checks, night depositary services, direct deposit, and safe deposit boxes.
10. PNC Bank
PNC Bank is a national bank with over 30 branches in cities such as Dover, Bear, Wilmington, and Newark. Its deposit accounts and other products are designed to meet all your banking needs. Virtual Wallet Spend is a combination checking and a long term savings account with a generous sign-up bonus and features like online bill pay, free mobile banking, and a debit card.
While there is a monthly maintenance fee, you can avoid this monthly fee if you maintain a direct deposit balance. PNC also offers loans, such as mortgages, home equity lines of credit, auto loans, personal loans, student loans, and refinancing products. With the PNC mobile app, you’ll be able to manage your accounts while you’re on the go.
11. Ally Bank
Ally Bank is an online bank with competitive rates on savings accounts, money market accounts, and CDs. Thanks to its low overhead costs, Ally doesn’t charge monthly maintenance fees or impose minimum balance requirements.
You can access your money and make cash transactions at more than 43,000 ATMs through the Allpoint network, which Ally has joined. If you have certain savings goals, you’ll love Ally’s “buckets” feature. With the buckets, you’ll be able to organize your funds and receive personalized recommendations that allow you to save.
12. Wells Fargo
Wells Fargo is one of the largest banks in the U.S. with no shortage of physical branches and ATMs throughout Delaware so you can easily deposit cash. Just like most large banks, Wells Fargo offers a full suite of banking products, such as checking accounts, savings accounts, credit cards, home loans, personal loans, and auto loans.
Investment and retirement accounts as well as wealth management services are available too. You can invest on your own or take advantage of a financial advisor that will help you come with a personalized financial plan. Whether you’re an individual or a small business owner, you’re bound to find what you’re looking for at Wells. If you open an account, you may be eligible for a cash sign on bonus.
13. WSFS Bank
WSFS Bank is a regional bank and a subsidiary of a financial services company called WSFS Financial Corporation. Based in Delaware and Greater Philadelphia, WSFS Bank is known as one of the oldest banks in the country.
It offers a wide range of personal banking services, like checking accounts, savings accounts, credit cards, loans, and wealth management. Its certificates of deposit (CDs) feature competitive interest rates you might not be able to find elsewhere and the WSFS Bank Philadelphia Union Visa® Debit Card comes with contactless pay and access to more than 670 ATMs in Delaware and Philadelphia.
At WSFS Bank, you can also take advantage of business banking services, like SVP management, cash management, and merchant services.
Delaware Banking Options
There are three main types of banks in Delaware, including national banks, community banks, and online banks. Here’s a brief overview of each one.
National Banks
National banks are large banks that can be seen throughout Delaware and other states. These banks typically offer a long list of products for individuals and business owners, such as checking accounts, savings accounts, retirement accounts, credit cards, and mortgages. Some examples include TD Bank, Wells Fargo, and PNC Bank.
Community Banks
Community banks are designed to serve local communities in Delaware. You’ll find that these banks prioritize personal customer service. Community Bank Delaware and the Bank of Delmarva are two community banks in the First State.
Online Banks
Online banks operate online and don’t have physical locations in Delaware. Since their overhead costs are lower than banks with brick-and-mortar branches, online banks usually provide lower fees and higher interest rates. Chime, Axos Bank, Ally, and UK-based Barclays Bank are great online banking options in Delaware.
Bottom Line
Delaware has plenty of banks and other financial institutions to help you meet your financial goals. Before you choose one, consider your priorities and weigh the pros and cons of all your options.
If you like an in-person banking experience, a community bank might make sense. On the flip side, if you prefer online and mobile banking, an online bank is likely the way to go. Good luck with your search for the best bank in Delaware.
Frequently Asked Questions
How do Delaware banks keep my money safe?
Most banks insure your deposits up to 250,000 with the FDIC or Federal Deposit Insurance Corporation. Other services like fraud protection can also give you some peace of mind for your linked accounts.
What are the most popular banks in Delaware?
The banks with the most branches in Delaware include PNC Bank, M&T Bank, and WSFS Bank. If in-person banking is important to you, these banks should definitely be on your radar.
Can I open a bank account in Delaware as a non-resident?
Yes. In most cases, you can open an interest earning account or business savings account even if you don’t live in Delaware. You’ll likely need an Individual Taxpayer Identification Number (ITIN).
Chime is a financial technology company, not a bank. Banking services and debit card provided by The Bancorp Bank N.A. or Stride Bank, N.A.; Members FDIC. Credit Builder card issued by Stride Bank, N.A.
1. Out-of-network ATM withdrawal fees may apply with Chime except at MoneyPass ATMs in a 7-Eleven, or any Allpoint or Visa Plus Alliance ATM.
2. Early access to direct deposit funds depends on the timing of the submission of the payment file from the payer. Chime generally make these funds available on the day the payment file is received, which may be up to 2 days earlier than the scheduled payment date.
5. Chime SpotMe is an optional, no fee service that requires a single deposit of $200 or more in qualifying direct deposits to the Chime Checking Account each at least once every 34 days. All qualifying members will be allowed to overdraw their account up to $20 on debit card purchases and cash withdrawals initially, but may be later eligible for a higher limit of up to $200 or more based on member’s Chime Account history, direct deposit frequency and amount, spending activity and other risk-based factors. Your limit will be displayed to you within the Chime mobile app. You will receive notice of any changes to your limit. Your limit may change at any time, at Chime’s discretion. Although there are no overdraft fees, there may be out-of-network or third party fees associated with ATM transactions. SpotMe won’t cover non-debit card transactions, including ACH transfers, Pay Anyone transfers, or Chime Checkbook transactions. See Terms and Conditions.