Penfed mortgage rates 30 year

Penfed mortgage rates 30 year DEFAULT


Today we’ll take a deep dive into a major credit union that’s also a sizable mortgage lender, Pentagon Federal Credit Union, or PenFed for short.

While originally intended to serve the U.S. military, veterans, and various defense department government employees, today anyone can join PenFed, whether part of those groups or not.

For example, if you have no military affiliation whatsoever, it’s possible to join if your employer is eligible or if you make a small donation to an organization.

PenFed has been around since 1935, and today serves more than two million members worldwide with a whopping $25 billion in assets.

They lend in all 50 states and the District of Columbia, as well as in Guam, Puerto Rico, and Okinawa. Let’s learn more.

PenFed Mortgage Fast Facts

  • Members-only credit union federally insured by NCUA
  • Founded in 1935, headquartered in Alexandria, Virginia
  • Anyone free to join regardless of lack of military background
  • Offer checking and savings accounts, credit cards, mortgages, and HELOCs
  • Licensed to lend in all 50 states, D.C., Guam, Puerto Rico, and Okinawa
  • Funded more than $8.2 billion in home loans last year
  • Did about a fifth of total loan volume in home state or Virginia
  • Also operate a wholly-owned title insurance company called PenFed Title, LLC and real estate brokerage called PenFed Realty

As noted, anyone can join PenFed, though they are a members-only credit union. So once you become a member, you can take advantage of their many product offerings, including home mortgages.

Last year, the Alexandria, VA-based credit union did roughly $8.2 billion in total home loan origination volume, with about a fifth of it in its home state of Virginia.

A good chunk was also originated in the nearby states of Maryland and Florida, along with Texas and faraway California.

Home purchase loans accounted for roughly 50% of volume, with 25% rate and term refinances, almost 20% cash out refinances, and the remainder HELOCs.

And while most of their home loans were fixed-rate mortgages, they offer a variety of adjustable-rate mortgages as well.

How to Apply for a Home Loan with PenFed Mortgage

  • Members can submit their loan application directly from their account on PenFed Online
  • They ask that you call them or submit a call back request online if refinancing or inquiring about a HELOC
  • Those looking to generate a pre-approval can do so right away via the online portal
  • They offer a digital mortgage loan experience that allows you to complete most tasks electronically

Assuming you’re a PenFed member, it’s possible to get the ball rolling simply by calling them up directly or by filling out a short call back request form on their website.

If you’re looking for a mortgage pre-approval for a home purchase, you can also begin on your own via the PenFed online portal.

Speaking of real estate, PenFed operates an affiliated real estate brokerage known as PenFed Realty, which is backed by Berkshire Hathaway HomeServices.

Like many other banks and lenders, PenFed offers a digital mortgage experience where you can eSign disclosures, scan and upload documents, receive real-time status updates, and check loan progress 24/7.

PenFed also operates its own title insurance company, which might speed up the loan process and/or result in discounts on such services.

Loan Programs Available at PenFed Mortgage

  • Home purchase loans
  • Refinance loans (rate and term and cash out)
  • Conventional loans backed by Fannie Mae and Freddie Mac
  • Jumbo loans up to $5 million loan amounts
  • VA loans for eligible military and veterans
  • Home equity lines of credit (HELOCs)
  • Various fixed-rate and adjustable-rate options available

PenFed offers both home purchase financing and refinance loans on a variety of property types, including single-family homes and condos/townhomes, along with multi-unit properties.

It’s possible to finance a primary residence, second home, or investment property using a conventional loan backed by Fannie Mae and Freddie Mac, or a jumbo home loan that exceeds the conforming loan limit.

They also specialize in VA loans seeing that they were originally geared specifically toward military and veterans.

While they don’t offer FHA loans or USDA loans, which is a major downside for some borrowers, they do offer a home equity line of credit (HELOC) product, with the possibility to tap equity up to 90% CLTV.

PenFed pays most of the closing costs on the HELOC, and will waive the $99 annual fee if $99 in interest is paid during the preceding 12-month period.

The only caveat on that product is if you pay it off or close it within 36 months you’ll need to reimburse the full amount of the PenFed-paid closing costs for the loan.

PenFed also offers some unique proprietary loan programs like their 15/15 ARM or their 5/5 ARM if you’re looking for something a little different.

And they offer traditional ARMs like the 5/6 ARM and 7/6 ARM, along with the usual fixed-rate options like a 30-year and 15-year fixed.

PenFed Mortgage Rates

One nice thing about PenFed is the fact that they openly advertise their mortgage rates for all to see on their website.

You don’t need to sign in to see their rates – simply surf over to their site to see today’s rates on a variety of products including conventional fixed-rate loans, jumbo fixed-rate loans, and VA loans.

They don’t advertise their ARM rates so you’ll either need to click on “Get My Rate” to generate your own mortgage rate quote on their website or call in for pricing if you want an adjustable-rate mortgage.

From what I saw, their mortgage rates were competitive, especially since they say they don’t charge lender fees.

Additionally, those purchasing a home get a lender credit ranging from $500 to $2,500 depending on loan amount, which can be used to offset any third-party closing costs like the home appraisal or title insurance.

All in all, PenFed’s mortgage rates seem competitive and the lack of lender fees makes them even more desirable when you consider the mortgage APR.

PenFed Mortgage Reviews

They have a rather marginal 3.8-star rating out of 5 on Zillow, though it’s only based on about two dozen customer reviews. Still, it leaves a lot to be desired.

Similarly, they have a 3.9-star rating out of 5 on WalletHub from a much larger sample size of about 6,000 reviews, but that may include non-mortgage related products.

However, quite a few seem to focus on their mortgage or home equity products, so you’ll be able to read about relevant customer experiences.

It’s the same story over at Bankrate, a 3-star rating from eight reviews. Again, not a lot there, but still seems to be consistent with other ratings sites.

While they aren’t a Better Business Bureau accredited company, they do currently have an ‘A+’ BBB rating based on complaint history.

But their customer reviews on the BBB website are rather poor, with a 1.2-star rating on 75 reviews at last glance.

So it seems they’re struggling a bit in the customer satisfaction department, despite having a solid website, competitive mortgage rates, and no lender fees.

Veterans may qualify for a $0 down VA loan

PenFed Mortgage Pros and Cons

The Good

  • They openly advertise their mortgage rates which appear to be competitive
  • Don’t charge lender fees
  • Lender credit specials on home purchase loans
  • Can apply for a mortgage online via digital process
  • Offer lots of home loan programs including home equity products
  • Jumbo loan amounts as high as $5 million
  • Free mortgage calculators on their website
  • They service their home loans

The Maybe Not

  • Limited number of branches if you don’t live by a base
  • Do not offer FHA loans or USDA loans
  • Mediocre reviews from past customers

(photo: Wiyre Media)


Mortgage rate forecast for next week (October 17-23)

Between October 11-15, we saw mortgage rates increase sharply and then moderate towards the end of the week.

Next week (October 17-23) is light on economic news. So rates could hold steady in their current range.

Looking forward even further, rates should continue to rise in October, November, and December. Though the speed at which they increase will depend on Covid case trends, Federal Reserve actions, and the overall health of the U.S. economy.

Find your lowest mortgage rate. Start here (Oct 19th, 2021)

In this article (Skip to…)

Will mortgage rates go down in October? 

Mortgage rates have already increased in October. In just one week, the average 30-year fixed rate moved from 2.99% to 3.05% — its highest point since April. And rates should keep climbing throughout the month.

“As inflationary pressure builds due to the ongoing pandemic and tightening monetary policy, we expect rates to continue a modest upswing,” said Sam Khater, Freddie Mac’s chief economist, on October 14.

The Federal Reserve is another big driver behind current mortgage rate trends.

This week, we learned that the Fed plans to move forward with its ‘tapering’ plans this year, likely starting in November.  

That means the Fed plans to slow — and eventually stop — its mortgage stimulus program, which has been keeping rates low since 2020.

As the Fed’s plans solidify, they’re already being priced into current mortgage rates. So even though the Federal Reserve hasn’t actually changed any of its policies yet, rates are already going up on the expectation that it will.

The bottom line is that borrowers shouldn’t expect rates to fall in October.

Although we could see small rate drops from time to time, they’re likely to be temporary blips in an overall upward trend.

Get started shopping for mortgage rates (Oct 19th, 2021)

Mortgage interest rates forecast next 90 days

Mortgage rates seem set to rise over the next 90 days. It’s likely the Fed will start easing off its economic stimulus before the end of the year, which could cause mortgage rates to go up in November or December.

On average, major housing authorities predict that 30-year mortgage rates could go as high as 3.14% by the end of the year. Those would be the highest interest rates since April 2021, when rates spiked to 3.18%.

Mortgage rate predictions for late 2021

Housing experts and economists are split on how high mortgage rates will go before the end of the year.

Fannie Mae is still predicting average 30-year rates as low as 2.90% through the end of 2021, while Freddie Mac is forecasting an increase to 3.40%. The average agency prediction for 30-year mortgage rates is 3.14%.

Housing Authority30-Yr Mortgage Rate Prediction (Q4 2021)
Fannie Mae2.90%
National Assoc. of Home Builders2.96%
Mortgage Bankers Association3.10%
Wells Fargo3.20%
National Association of Realtors3.30%
Freddie Mac3.40%
Average Prediction3.14%
Find your lowest mortgage interest rate. Start here (Oct 19th, 2021)

The Federal Reserve and mortgage rates

Since the start of the coronavirus pandemic, the Fed has been buying $40 billion of mortgage-backed securities (MBS) per month. MBS are a type of bond that largely determines mortgage rates.

By injecting billions of dollars into the MBS market each month, the Fed has been keeping mortgage interest rates artificially low.

This was a temporary measure to keep the economy propped up during Covid. And now that we’re seeing a steady economic recovery, the Fed is getting ready to pull back on — and eventually stop — its mortgage stimulus program.

In fact, the Fed has already said there’s a good chance it will start tapering its MBS purchase program by mid-November. And mortgage rates should keep going higher as the Fed’s support is withdrawn.

Current mortgage interest rate trends 

Mortgage rates increased sharply this week. The average 30-year fixed rate rose from 2.99% to 3.05% according to Freddie Mac’s weekly rate survey.

Per the survey, 15-year fixed rates also rose from 2.23% to 2.30%. And the average rate for a 5/1 ARM rose from 2.52% to 2.55%.

30-year mortgage rate trends in 2021


Source: Freddie Mac

Overall, mortgage rates are still relatively close to their lowest levels in history.

The lowest 30-year mortgage rate ever was just 2.65%, recorded by Freddie Mac in January 2021. So anyone who can lock in at or near today’s mortgage rates is getting a fantastic deal on their home loan.

Also keep in mind that average rates are just that — averages. “Prime” borrowers with great credit and large down payments often get lower interest rates than the ones shown here. And borrowers with lower credit or fewer assets may get higher rates.

Mortgage rate trends by loan type 

Many mortgage shoppers don’t realize there are different types of rates in today’s mortgage market. 

But this knowledge can help home buyers and refinancing households find the best value for their situation.

Following are 3-month mortgage rate trends for the most popular types of home loans: conventional, FHA, VA, and jumbo.

August 2021July 2021June 2021
Conforming Loan Rates3.05%2.99%3.16%
FHA Loan Rates3.13%3.10%3.23%
VA Loan Rates2.73%2.64%2.80%
Jumbo Loan Rates3.02%2.97%3.10%

Source: Black Knight Originations Market Monitor Report

Which mortgage loan is best?

The best mortgage for you depends on your financial situation and your goals.

For instance, if you want to buy a high-priced home and you have great credit, a jumbo loan is your best bet. Jumbo mortgages allow loan amounts above conforming loan limits — which max out at $548,250 in most parts of the U.S.

On the other hand, if you’re a veteran or service member, a VA loan is almost always the right choice.

VA loans are backed by the U.S. Department of Veterans Affairs. They provide ultra-low rates and never charge private mortgage insurance (PMI). But you need an eligible service history to qualify.

Conforming loans and FHA loans (those backed by the Federal Housing Administration) are great low-down-payment options.

Conforming loans allow as little as 3% down with FICO scores starting at 620.

FHA loans are even more lenient about credit; home buyers can often qualify with a score of 580 or higher, and a less-than-perfect credit history might not disqualify you.

Finally, consider a USDA loan if you want to buy or refinance real estate in a rural area. USDA loans have below-market rates — similar to VA — and reduced mortgage insurance costs. The catch? You need to live in a ‘rural’ area and have moderate or low income to be USDA-eligible.

Find your lowest mortgage rate (Oct 19th, 2021)

Mortgage rate strategies for October 2021

Rates seem likely to rise in September and beyond, if only marginally. But there are still great opportunities to be had for home buyers and refinancing homeowners in 2021.

Here are just a few strategies to keep in mind if you’re mortgage shopping in the next few months.

Should I refinance now?

Refinance rates are still incredibly low. But economic movements in the next month could send rates on an upward trajectory. That means the low-rate refi window could be narrowing.

If you haven’t refinanced yet — but you’ve been considering it — now might be the time to get serious about deciding.

So, how do you know whether you should refinance now?

Mortgage advisor Arjun Dhingra shared a few tips on a recent episode of The Mortgage Reports podcast. He says now might be the time to refinance if:

  • Your current mortgage rate is 3.25% or higher
  • You need to lower your monthly mortgage payments
  • You want to pay off your home sooner
  • You need cash now and have enough equity to pull from

It might seem like ultra-low rates are the new norm. But, as Dhingra says, “inevitably, the music will stop.”

You can easily check your refinance eligibility and your new rate with a lender.

Check your refinance eligibility and rates (Oct 19th, 2021)

Earlier this year, Fannie Mae and Freddie Mac instituted a new rule that raised interest rates on investment property and second home loans.

But, as of mid-September, that rule has been put on hold.

That means home buyers can get cheaper financing on investment property and vacation home loans — at least for the time being. The rule is currently being reviewed, so there’s no guarantee it won’t eventually be put back in place.

With home values rising across the nation, it’s a smart time to consider buying an investment property. You could build home equity quickly while covering your mortgage payments via rental income.

Or you could cash-out home equity to purchase a vacation home.

U.S. homeowners currently have a record amount of equity and a cash-out refinance or home equity loan can put those dollars to work.

Save more by shopping around

Mortgage lenders are still offering near-record low rates to good borrowers. But there’s a catch.

You can’t just look for the lowest rate advertised online. Because the rates lenders advertise aren’t available to everyone.

Those offers typically represent borrowers with perfect credit, 20% down or more, and a sterling credit history.

Those criteria won’t apply to everyone. The rate you’re actually offered depends on:

  • Your credit score and credit history
  • Your personal finances
  • Your down payment (if buying a home)
  • Your home equity (if refinancing)
  • Your loan-to-value ratio (LTV)
  • Your debt-to-income ratio (DTI)

To figure out what rate a lender can offer you based on those factors, you have to fill out a loan application. Lenders will check your credit and verify your income and debts, then give you a ‘real’ rate quote based on your financial situation.

You should get 3-5 of these quotes at minimum. Then compare them to find the best offer.

Look for the lowest rate, but also pay attention to your annual percentage rate (APR), estimated closing costs, and ‘discount points’ — extra fees charged upfront to lower your rate.

This might sound like a lot of work. But you can shop for mortgage rates in under a day if you put your mind to it. And shaving just a few basis points off your rate can save you thousands.

Compare mortgage and refinance rates. Start here (Oct 19th, 2021)

Mortgage interest rate FAQ 

What are current mortgage rates?

Current mortgage rates are averaging 3.05 percent for a 30-year fixed-rate loan, 2.30 percent for a 15-year fixed-rate loan, and 2.55 percent for a 5/1 adjustable-rate mortgage, according to Freddie Mac’s latest weekly rate survey. Your own rate could be higher or lower than average depending on your credit score, down payment, and the lender you choose to work with, among other factors.

Will mortgage rates go down next week?

Mortgage rates shouldn’t move dramatically next week (October 17-23, 2021). There was a lot of movement between October 11-15, as the FOMC minutes from September’s Federal Reserve meeting were released and a new Core Inflation report came out. But next week should be quieter in terms of economic news and interest rates.

Are mortgage rates expected to drop in 2021? 

Mortgage rates are not expected to drop by any significant amount in the remainder of 2021. However, if the Covid cases continue to worsen due to the Delta variant, this could drag down the U.S.’s economic recovery. Any significant slowdown could push mortgage rates lower, or at least help to keep them in the sub-3 percent range throughout the fall.

Will mortgage interest rates go up in 2021?

Yes, mortgage rates are likely to increase in 2021 and next year. Most economists and housing authorities are predicting rates in the low- to mid-3 percent range by the end of the year, rather than in the high 2s where they’ve been recently. However, due to economic uncertainty caused by the Covid-19 Delta variant, significant rate increases may not come until the end of the year. 

What is the lowest mortgage rate right now? 

Freddie Mac is still citing average 30-year rates below 3 percent. But remember that rates vary a lot by borrower. Those with perfect credit and large down payments may see lower rates in the 2 percent range, while poor-credit borrowers and those with non-QM loans might see interest rates closer to 4 percent. You’ll need to get pre-approved for a mortgage to know your exact rate.  

Will mortgage rates go up with inflation? 

In a normal market, inflation leads to higher mortgage rates. Fixed-rate assets like mortgage-backed securities (MBS) have to offer bigger returns to entice investors when inflation is rising. However, we’re not in a normal market. The Fed believes current inflation rates will be temporary, which is helping keep mortgage rates low. And economic concerns over coronavirus are pushing rates down as well. So they haven’t responded to inflationary pressures as usual. 

What is the lowest mortgage rate ever?

At the time of this writing, the lowest 30-year mortgage rate ever was 2.65 percent. That’s according to Freddie Mac’s Primary Mortgage Market Survey, the most widely-used benchmark for current mortgage interest rates.

What’s a good mortgage rate? 

Any mortgage rate in the low- to mid-3 percent range is very good by historical standards. Looking back just one year, mortgage rates started 2020 at nearly 4 percent. And they were above 4.5 percent in early 2019. So today’s rates are excellent by comparison.

Is now a good time to refinance? 

That depends on your situation. It’s a good time to refinance if your current mortgage rate is above market rates and you could lower your monthly mortgage payment. It might also be good to refinance if you can switch from an adjustable-rate mortgage to a low fixed-rate mortgage; refinance to get rid of FHA mortgage insurance; or switch to a short-term 10- or 15-year mortgage to pay off your loan early.

Is it worth refinancing for 1 percent? 

It’s often worth refinancing for 1 percentage point, as this can yield significant savings on your mortgage payments and total interest payments. Just make sure your refinance savings justify your closing costs. You can use a mortgage calculator or speak with a loan officer to crunch the numbers.

What will mortgage rates be in 5 years? 

Based on what we know today, it seems likely mortgage rates could be higher in 5 years than they are now. Current mortgage rates are near their lowest levels ever, and seem more likely to rise than to drop further. However, any number of unexpected events could change the course of interest rates in the next few years. For instance, no one predicted the Covid pandemic would push mortgage rates to new record lows in 2020 and 2021.

How do I shop for mortgage rates? 

Start by choosing a list of 3-5 mortgage lenders that you’re interested in. Look for lenders with low advertised rates, great customer service scores, and recommendations from friends, family, or a real estate agent. Then get pre-approved by those lenders to see what rates and fees they can offer you. Compare your offers (‘Loan Estimates’) to find the best overall deal for the loan type you want.

Should I lock my mortgage rate today?

Refinancers: If you’ve compared loan offers and you’re confident you’ve found the best deal, today is a great time to lock a mortgage refinance rate. Home buyers: If you have a signed purchase agreement and loan approval in hand, today is also a great time for you to find a low rate and lock in.

What are today’s mortgage rates?

Low mortgage rates are still available. You can get a rate quote within minutes with just a few simple steps to start.

Verify your new rate (Oct 19th, 2021)

1Today’s mortgage rates based on a daily survey of select lending partners of The Mortgage Reports. Interest rates shown here assume a credit score of 740. See our full loan assumptions here.

Selected sources:

  1. Local travel nursing agencies
  2. 2014 nissan altima s horsepower
  3. Hertz speakers for harley davidson
  4. Black ink crew compton location

PenFed Student Loan Refinance Review

Our Rating: B+ ⓘ (Compare)

Loan Limits$7,500 – $300,000
Fixed Rates2.89% – 5.08%
Variable RatesNA
Terms5, 8, 12 or 15 years
Min. Credit Score700* (670 with co-signer)

*For loans up to $150,000. For loans exceeding $150,000, a credit score of less than 725 requires a qualifying co-signer.

Skip to:Rates & Fees | Eligibility Requirements | Repayment Options | Consumer Reviews & Complaints | FAQ

One of the largest credit unions nationwide, Pentagon Federal Credit Union or PenFed offers student loan refinancing through Purefy. PenFed services its own loans and offers other financial services typical of a credit union.

Private student loans
Private parent loans (in either name†)
Federal student loans
Federal Parent PLUS loans (in either name)

Parents may refinance in their own names or transfer debt to a child.

PenFed Refinance Rates & Fees

PenFed’s fixed rates are between 2.89% and 5.08%. PenFed appears to no longer offer variable rates.

TermFixed Rate
5 Year2.89% – 5.08%
8 Year3.14% – 5.08%
12 Year3.07% – 5.08%
15 Year3.25% – 5.08%

Additional information about PenFed refinance rates:

  • Checking your rate with PenFed will not affect your credit score. They will conduct a soft, not hard, credit inquiry (learn the difference).
  • PenFed does not offer a discount for setting up auto-pay.
  • PenFed offered variable rates until 7/1/2021; it is unclear if variable rates will become available again.

Student Loan Refinancing Calculator

Based on advertised rates, use the calculator below to determine what your new monthly payment and potential savings may be if you refinance with PenFed.

Additional Fees

Beyond interest rates, there are a number of fees a refinance lender may charge up-front or during the loan servicing period. Below is a list of these fees that PenFed does or does not charge.

Fee TypeAmount Charged
Application FeeNone
Loan Origination FeeNone
Disbursement FeeUndisclosed
Prepayment PenaltyNone
Late Payment Fee$5 to $25
Returned Payment FeeUndisclosed
Collection FeeUnspecified
  1. Application fee – fee to apply for rates & approval.
  2. Loan origination fee – fee to create the new loan.
  3. Disbursement fee – fee for distributing funds to lenders to pay off loans that have been refinanced.
  4. Prepayment penalty – fee for making extra payments to reduce a refinance loan balance or pay it off early.
  5. Late payment fee – fee for making a late payment.
  6. Returned payment fee – fee for failed payments due to insufficient funds, also known as a “bounced check.”
  7. Collection fee – fee for collection activity on a defaulted debt. PenFed discloses only that “[i]n the event of a default, the borrower may incur additional collection charges as permitted under applicable law.”

Current Promotions & Offers

PenFed does not typically offer promotions, discounts, or other such benefits. Branch locations sometimes have their own special offers available.

PenFed Refinance Eligibility Requirements

To qualify for refinancing with PenFed, all borrowers must meet the criteria below.

  • Citizenship Requirement: U.S. citizenship.
  • Income Requirement: $42,000 annual minimum for loans up to $150,000, $50,000 annual minimum for loans up to $300,000 -OR- $25,000 annual minimum with a qualifying co-signer.
  • Credit Score Requirement: minimum 700 for loans up to $150,000, 725 for loans up to $300,000 -OR- 670 with a qualifying co-signer.
  • Graduation Requirement: bachelor’s degree or higher.
  • Location Requirement: none.

Additional restrictions apply for specific individuals and loans.

  • Borrowers are required to be existing PenFed credit union members or join PenFed before loan authorization.
  • PenFed membership requires opening a PenFed savings account with a minimum of $5.

PenFed Student Loan Repayment Options

Lenders vary significantly on the benefits and options provided to borrowers during the loan servicing period. Additionally, benefits may only be available on a case-by-case basis. PenFed offers some relief options.

Deferment & Forbearance

PenFed does not advertise deferments or forbearance but does disclose a willingness to consider deferment under certain circumstances and on a case-by-case basis.

Returning to grad schoolUndisclosed
Disability rehabilitationUnspecified
Active military dutyUndisclosed
Involuntary unemploymentUnspecified
Economic hardshipUnspecified
Natural disasterUndisclosed
Temporary hardshipUnspecified

Additional Options

PenFed may offer other opportunities for relief or contract modification.

  • Co-signer release may be available after 12 consecutive qualifying payments.
  • Death / disability discharge is available in the unfortunate circumstance that a borrower passes away or suffers total permanent disability.

PenFed Reviews, Complaints & Lawsuits

Beyond our own findings, our team also collected the most genuinely insightful customer experiences available, including any instances of legal action against the company in which the details became public.

PenFed Online Reviews

Below are 3 samples of PenFed customer reviews we found on public forums, included here for their value as unedited, uncensored, and unsolicited user experiences. Note that these reviews are unverified, may include inaccuracies, and may provide outdated information (about rates, bonus offers, etc.).

“I recently refinanced a student loan with PenFed. I managed to get my 6% loan refinanced for 4%. Their portal seems not very advanced, but they offered me one of the lowest rates I could find compared to others. I also signed up for the 8 year plan. If I did the 5 year plan, I could have received a 3.75% rate; however, the monthly payment was too high to make it worth it. I have not had any issues with them these past few months.” – MikeIzSuave on reddit, 7/14/2020

“Hey I actually just refinanced with PenFed (through [a marketplace lender]) and was quoted 1.6% variable. I also noticed the paperwork that said minimum of 2% which didn’t make sense since they quoted the 1.6%. I went ahead and followed through with the loan and it finally posted in the past few days and it’s already gone down to 1%. So I don’t really know what the minimum 2% refers to but it seems like mine has been below that without a problem so far. You may want to clarify with PenFed before signing though.” – parkit on reddit, 5/16/2020

“Penfed has some issues on the front end.

I was declined a refi of $30K for a 5 year loan reason being my income to debt ratio was “bad”. I inquired and inquired and for some reason they had that I earned $1100 per month. How they arrived at that I don’t know as they had the copies of my paystubs at $3300 bi weekly……..

In the end it all worked out but yes, they aren’t on top of things.” – retiredjg at, 6/18/2014

More (unfiltered) customer reviews of PenFed are available at (4.6 out of 5) and (4.6 out of 5).

PenFed CFPB Complaints

As consumer finance companies, student loan refinancing lenders fall under the jurisdiction of the Consumer Financial Protection Bureau (CFPB), a federal agency. As part of its mission, the CFPB allows consumers to log official complaints. These complaints are publicly available on the CFPB official website.

Since December 2011, consumers have submitted 2,199 complaints about Pentagon Federal Credit Union (PenFed) to the CFPB for an average of four (4) complaints per week. At least one (1) of these complaints specifically refers to PenFed’s student loan refinancing program.

The allegations made in these complaints are unverified, are not necessarily representative of all consumers’ experiences with PenFed, and may contain outdated information (about rates, bonus offers, etc.). Note that a lender with a large customer base is likely to have a higher number of complaints when compared with smaller lenders.

Below we’ve included the 3 most recent complaints (as of this writing) in which the consumer consented to share their details.

Complaint 4554993
New York

“Someone stole my identity and opened many accounts without my permission or authority.”

Complaint 4528923


Complaint 4528885

“I applied, and was approved for an installment loan with Pentagon FCU. I have been paying down on the note for probably more than a year now. In XXXX of 2021, my employer announced potential future layoffs as the result of a bank merger. I work for a bank. I contacted Pentagon FCU and attempted to enroll the installment loan in their debt protection program. Due to a glitch in their online system, however, I was unable to retrieve the documents that I needed to sign. Rather than address the glitch, Pentagon told me that in order to properly add on the protection, they would need to ” rebuild ” the loan. I went with it as I really wanted the protection. About a month later, I checked the loan details online. They raised the rate from the initial 8.49 % fixed to 12.99 %. When I contacted the company, they acknowledged the error and changed the rate back to match the terms of the original loan agreement. Since then, I have received a total of three requests to sign an official promissory note for their records. The issue with the promissory note is that it contains invalid information – the rate is 12.99 % rather than the original rate. And the monthly payment is therefore also incorrect. When I contacted them ( several times ) to dispute this, their resolution was to send an addendum letter, signed by a loan operations representative along with yet another promissory note for ME to sign containing the same invalid rate, payment and other calculated terms. XX/XX/XXXX, I contacted Penfed again and was told that they requested a corrected promissory note for me to sign but the request was ” denied ”. I was also told that if I did not sign the invalid promissory note that they have continued to send me, they would probably raise the interest rate on the loan. I refuse to sign a legal document that is not correct and I hope someone at this agency will agree with me. Please address this issue with Pentagon Federal Credit Union. If the promissory note is something that they can not reproduce from the system, I would suggest that they create one manually with the correct information on it and I would be happy to sign it. Something is very wrong with this institution. I have been in banking 20 years and have never seen anything like this.”

For a complete list of the 2,199 complaints made against PenFed in the CFPB’s Consumer Complaint Database, click here.

PenFed Lawsuits

Note that while this information is updated regularly, ongoing legal action is subject to change.

Nyjah Ross et al., v. Pentagon Federal Credit Union, et al., Case No. 1:20-cv-00281-RDA-JFA

In March 2020, Nyjah Ross and Thomas Castelli filed a class action complaint against PenFed alleging violation of Regulation E of the Electronic Fund Transfer Act (EFTA).

Specifically, plaintiffs claim they were charged multiple non-sufficient funds (NSF) fees for the same electronic transaction and were also charged NSF fees when their accounts did have sufficient funds to cover the transaction. This is the second civil action against PenFed for apparent violation of its own account agreement regarding NSF charges to borrowers.

The case has been assigned to US District Court for the Eastern District of Virginia, Judge Rossie D. Alston presiding, and is presumably ongoing.

Tiffany Neal v. Pentagon Federal Credit Union, Case No. ELH-18-451

Plaintiff Tiffany Neal, a disabled veteran, filed a civil action suit against PenFed in August 2019, alleging the credit union violated EFTA as well as multiple sections of the State of Maryland’s Breach of Contract law.

Specifically, Neal alleges PenFed “unlawfully withdrew disability benefits from her PenFed account to offset Neal’s overdue loan payments.”[2]

This case has been assigned to United States District Court, District of Maryland’s 4th circuit court, Judge Ellen L. Hollander presiding, and is presumably ongoing.[3]

Frequently Asked Questions

These are the most common questions consumers have about student loan refinancing with PenFed.

  • Is PenFed good for refinancing student loans?
    PenFed may be a good option for borrowers who wish to assume ownership of a parent loan or combine student debt with a spouse; this is especially true of financially established and secure borrowers who are or want to become members of Pentagon Federal Credit Union.
  • Are PenFed loans federal?
    No, PenFed loans are not federal. PenFed has no affiliation with the federal government or the U.S. Department of Education.
  • Does PenFed charge a prepayment penalty?
    No, there are no penalties for early payments or repaying a loan in full before its term is over.
  • Does checking your rates with PenFed hurt your credit score?
    PenFed performs a soft credit check for their prequalification process, which will not hurt your credit score. If you proceed with an application, however, PenFed will perform a hard credit check that may affect your credit score.
  • Is PenFed a bank?
    No, PenFed is not a bank; it was among the first credit unions founded under the Federal Credit Union Act as part of President Roosevelt’s New Deal in 1935.
  • Can I refinance a PenFed loan?
    Yes, you can refinance a PenFed student loan or a student loan from another private lender. There is no limit to the number of times a borrower may refinance with PenFed. Note, however, that every new line of credit requires a hard credit check that may affect your FICO score.
  • Can I refinance just some of my loans with PenFed?
    Yes, you can refinance some, all, or just one of your qualifying student loans with PenFed. You may choose to refinance your private loans only or refinance private and federal loans together.
  • Can I refinance loans that have already been refinanced?
    Yes, you can refinance loans as many times as you want with PenFed. Note that each time you refinance, you will have to submit a new application; every application requires a hard credit check that may affect your credit score.
  • Can my spouse and I refinance our loans together with PenFed?
    Yes, PenFed evaluates spouses together and allows them to combine debt. Spouse co-signers are exempt from co-signer release; 67% of co-signed PenFed student loan refinances are spousal loans.
  • How long does it take to refinance with PenFed?
    It will likely take between 6 and 16 weeks from application until your first refinance payment is due. PenFed estimates 3-14 days for disbursement, with the first payment due 30 days after that.
  • Who services PenFed refinance loans?
    PenFed services all their own student refinance loans.
  • Does PenFed offer a grace period?
    No, PenFed does not offer a grace period.
  • How often do variable rates change?
    PenFed updates variable rates on the 1st of each month according to the 1-month LIBOR as it was on the 25th day of the preceding month (or the next business day if the 25th falls on a weekend or holiday).
  • Can I get any special rates or discounts with PenFed?
    PenFed does not advertise any discounts or rate reductions. Branch locations may offer their own promotions.
  • What happens if I file for bankruptcy?
    PenFed does not specify what action the lender will take but cautions that borrowers who file for bankruptcy “may still be required to pay back [their] loan.”[5]
  • Is PenFed a Credible lender?
    Yes, PenFed does partner with Credible as part of its lender marketplace.

Compare Student Loan Refinance Reviews


  1. Justia Docket & Filings, Ross et al v. Pentagon Federal Credit Union et al
  2. Casetext, Neal v. Pentagon Fed. Credit Union, Civil Action No. ELH-18-451
  3. Govinfo, Content Details: 18-451 – Neal v. Pentagon Federal Credit Union
  4. Justia US Law, Pentagon Federal Credit Union v. McMahan
  5. PenFed, Variable Rate Application and Solicitation Disclosure
  6. Pentagon Federal Credit Union, Refinance Student Loans
  7. PenFed, Student Loan Refinancing Overview
  8. PenFed, Eligibility Criteria
  9. Jacksonville University, The More You Know: Great Advice for Grad and Pro 2020
  10. Consumer Financial Protection Bureau, Consumer Complaint Database
  11. Dun & Bradstreet, Business Directory
  12. Better Business Bureau, Search Businesses and Charities
Is PenFed The BEST Credit Union?

Pentagon Federal Credit Union User Reviews

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Mortgage rates 30 year penfed

Final Verdict

All of the VA lenders that offer the best VA loan rates have positive and negative features. Some offer low interest rates and multiple ways to contact customer service and others offer two mortgage terms to choose from. Overall, we recommend checking out Veterans United. They have continuously closed more VA loans than any other lender, have a positive reputation,and offer competitive rates. 

Compare The Best VA Loan Rates

CompanyStarting Interest RateLoan TermsMinimum Credit ScoreMaximum Loan Amount
Veterans United
Best Overall
2.75%30 yearsContact for detailsNone
PenFed Credit Union
Best 30-Year Fixed 
Contact for rates 30 years Not disclosedContact for details
Navy Federal Credit Union
Best 15-Year Fixed
2.25% 15 & 30 yearsNot disclosed Contact for details 
Best Jumbo Loan
3.25% 30 yearsNot disclosed $3 million
Lending Tree
Best ARM Loan
Contact for details Contact for detailsContact for details Contact for details 

Guide to Choosing the Best VA Loan Rates

Are You in Need of a VA Loan?

Assess your needs to determine if you currently require and qualify for a VA loan. If you’re a veteran, active service member, or the spouse of a veteran who died in service or from a service-related injury, you may qualify for a VA loan which can often offer more competitive rates and lower down payments than other loans. 

VA loans can be used to purchase a home, a multi-family property, as long as you live in one unit, or build a home. They can also be used to repair or improve a home or refinance your current mortgage. 

Compare VA Loan Rates & Lenders

When shopping for a VA loan, you will want to get the best rate to save the most money. Keep the following in mind when comparing VA loan rates and lenders:

  • Loan amounts: Know the loan limits and make sure the home you want to purchase fits within those parameters. You don’t want to find a $1 million dollar home and realize the lender only offers loans upto $750,000. 
  • Minimum credit score: Does the lender have a minimum credit score required to qualify? Know what your credit score is so you know if you qualify, should look for another lender, or should improve your credit before applying. 
  • Interest rates: Rates fluctuate based on market conditions and vary based on your FICO score and overall financial profile. Know the rate up front so you can compare it to other lenders. 
  • Customer service: How can you contact customer service if you have a question? Find out their hours and how responsive they are. This is a big purchase and you want to be confident with who you’re dealing with. 

Apply for a VA Loan

After you have made your VA loan selection, you will need to provide your Certificate of Eligibility (COE) to show that you’re eligible to qualify for a VA loan. You can get it through your eBenefits portal or by requesting it through the mail. Next you will work with a loan officer and complete an application, have your credit run, and get pre-qualified for the loan. You will need your social security number and identification and may also need proof of income such as a tax return. It makes the process easier if you’re organized and have all of your documents handy.

Frequently Asked Questions

What Is a VA Loan?

A VA loan is backed by the government and is open to active and former service members and their surviving spouses in some cases. One can use a VA loan to purchase or build a home, improve and repair a home, or to refinance a mortgage. Significant benefits include reduced credit score requirements, no private mortgage insurance, no down payment requirement, and competitive rates. 

You can apply for a VA loan more than once, but the funding fee increases when using a VA loan after your first time. The VA funding fee is a one-time charge that you pay when you get a VA-guaranteed mortgage to purchase or refinance your home. In many cases, you’ll have the option to roll the VA funding fee into your loan. The typical funding fee ranges from 1.4% to 3.60% of the loan amount.

You will need a certificate of eligibility (COE) which you can obtain from the VA website, or your lender can assist you with this. In order to get this certificate, you’ll have to produce service-related documentation, which can vary based on whether you are active duty or a veteran.

Do VA Loans Vary by Lender?

The two main ways a VA loan can vary slightly from lender to lender are the rate and the minimum credit score. The Veterans Administration does not underwrite the loan; it provides a guarantee to the lenders who offer the loan program. The lenders determine the rate they will offer, as well as the other underwriting guidelines they will adhere to, such as your credit history and debt-to-income ratio. 

Credit score minimum requirements differ slightly from lender to lender, with most settling on 620 as their accepted minimum. Credit limits are not set by the U.S. Department of Veteran Affairs. The VA’s only credit requirement is for the borrower to be considered a satisfactory credit risk by a lender.

The benefits of a VA loan are the same no matter which lender you choose. The key benefits of the program are no down payment requirement, no PMI requirement, and no prepayment penalties, with a VA funding fee taking the place of the PMI. 

Why Do Sellers Seem to Dislike VA Loans?

The VA has what are called “minimum property requirements.” These include non-negotiable items like construction defects, termite infestation, leaks, decay, dampness, and continuing settlement in or near the foundation. While sellers engaged with buyers who bring a non-VA loan to the purchase can negotiate the repair costs of these types of items, the VA program requires these items to be fixed before they will give the lender the approval to back the lender’s mortgage loan to the borrower. That puts pressure on the seller to fix these issues primarily at their cost if they want to be able to sell their home to the buyer who presents with a VA loan in their pocket.

What Problems Arise in a VA Home Inspection?

If you are purchasing a home with a VA loan, you will be required to obtain a home inspection. The cost will vary by location but ranges between $300 and $500. You will also need to obtain an appraisal for your property. The VA inspection is much more in-depth than the home appraisal. The inspector will look at the home's structural integrity, plumbing and electric systems, HVAC, roof, attic and crawl spaces, wood-destroying insects, fungus and dry rot, radon gas, and if applicable, the well and septic systems.  

The primary defective concerns the VA will have if discovered during the home inspection include construction defects, poor workmanship, foundation problems, dampness, leaks, decay, and termites.


We researched and reviewed 18 lenders to arrive at the best loan rates and terms for VA loan programs. The key criteria we reviewed were the length of the loans, the current rates, the minimum credit scores lenders accept, the application process, autopay features, and the customer service channels available.

Market Rate Forecast: October 18, 2021

PenFed Mortgage Review

Our goal is to give you the tools and confidence you need to improve your finances. Although we receive compensation from our partner lenders, whom we will always identify, all opinions are our own. Credible Operations, Inc. NMLS # 1681276, is referred to here as "Credible."

Pentagon Federal Credit Union is a nationwide, membership-based financial institution. Unlike many credit unions, PenFed is open to everyone. Once you’ve submitted your membership application and opened a savings account with a $5 minimum deposit — both of which you can do online — you’ll be eligible to apply for a mortgage loan.

PenFed offers a robust lineup of home loans, including conventional fixed-rate loans, jumbo loans, and home equity lines of credit (HELOCs). Members also get discounts on home insurance and title services from the credit union’s partner companies.

At a glance: PenFed credit union offers lender credits and member discounts on related services, and while it doesn’t provide FHA or USDA loans, its mortgage lineup should be enough to satisfy most borrowers.

In this review:

PenFed mortgage purchase review

Best for:

  • Homebuyers with less cash for closing costs
  • Borrowers with good credit
  • Active duty military and veterans

Standout feature: PenFed home loans offer lender credits ranging from $500 to $2,500, depending on your loan amount.

Pentagon Federal Credit Union mortgages include fixed-rate and adjustable-rate mortgages as well as VA loans and jumbo mortgages.

You can reduce your mortgage rate by paying points, which are advanced interest payments. PenFed’s website clearly discloses loan options with different rates and point amounts, and it also provides highly detailed closing cost information so you can budget accordingly.

Helping to balance out higher rates are PenFed’s lender credits, which reduce your closing costs. The credits are based on how much you borrow:

  • $500 credit for a loan of up to $199,999
  • $1,000 credit for a loan of $200,000 to $699,999
  • $2,500 credit for a loan of $700,000 or more

PenFed mortgage loans also have no lender fees. Considering the savings on the origination fee alone — which is typically 1% of the loan amount — plus the lender credit, cash-strapped buyers might be willing to pay a higher rate if it means bringing less cash to closing.

Mortgage programsConventional, VA, jumbo
Fixed-rate loan terms10, 15, 20, 30 years
Adjustable-rate loan terms3/1, 5/1, 7/1, 10/1, 15/1
Rates and fees
  • Rates depend on loan type, loan amount, and your creditworthiness
  • No lender fees
Min. credit score
  • Conventional: 650
  • VA: Contact lender
  • Jumbo: 700
Min. down payment
  • Conventional: 3%
  • VA: $0
  • Jumbo: 20% to 35%

Pros and cons of buying a home through PenFed

There are plenty of reasons to select a PenFed home loan, and a few caveats as well.


  • Lender credits
  • No lender fees
  • Highly transparent loan estimates
  • Online mortgage pre-approval


Credible isn’t affiliated with PenFed, but we make shopping for a home loan and finding a great mortgage rate easy — you can compare all of our partner lenders and see prequalified rates in as little as three minutes.

PenFed mortgage refinancing review

Best for:

  • VA loan borrowers
  • Homeowners who want to change the rate and/or term of their mortgage
  • Homeowners seeking a cash-out refinance

Standout feature: In addition to your typical rate-and-term and cash-out refinancing products, PenFed covers many of the closing costs for VA streamline refinance loans.

PenFed has mortgage refinance options for conventional loans, jumbo loans, and VA loans. The site’s Get My Rates tool lets you experiment with various loan types and terms as well as different cash amounts in the event you’re looking for a cash-out refinance.

One notable option is the VA streamline loan. Also known as an Interest Rate Reduction Refinance Loan (IRRRL), this product allows current VA loan holders to refinance to a lower rate quickly without the need for an appraisal.

You can roll closing costs into the loan too, and PenFed will even cover the VA funding fee.

The refinance application process is the same as for home purchase loans. You can apply for pre-approval on the website, but you must talk to a loan officer to get the ball rolling on your application.

Mortgage refinance programsConventional, VA, jumbo
Fixed-rate loan terms10, 15, 20, 30 years
Adjustable-rate loan terms3/1, 5/1, 7/1, 10/1, 15/1
Rates and fees
  • Rates depend on loan type, loan amount, and your creditworthiness
  • Some closing costs waived for VA streamline refinance
Min. credit score
  • Conventional: 650
  • VA: Contact lender
  • Jumbo: 700

Pros and cons of refinancing through PenFed

PenFed mortgages offer nice perks to homeowners looking to refinance. But it’s important to understand the credit union’s limitations as well.


  • Good variety of adjustable-rate loan terms
  • No lender fees
  • Some closing costs waived on VA IRRRL refinances
  • Transparent rates and closing costs


  • No FHA options
  • Can’t begin a mortgage application without talking to a loan officer

How does PenFed stack up?

If you’re a veteran looking for mortgage products, consider Veterans United. The lender has a full roster of VA loans, and it offers FHA and USDA loans as well.

PenFed mortgage reviews like this one go a long way toward helping you decide if the lender is a good fit for your needs. But don’t apply before you’ve explored all your options.

Shopping around for mortgage rates takes time, but Credible can help. As an online mortgage broker, we make it easy to compare personalized rates and loan information from several lenders so you can be sure you’re getting a great deal.

Keep Reading: 13 Tips for First-Time Homebuyers: Your Must-Know Advice


The company above is one of Credible’s approved partner lenders. Because they compete for your business through Credible, you can request rates from them by filling out a single form. Then, you can compare your available options side-by-side. Requesting rates is free, doesn’t affect your credit score, and your personal information is not shared with our partner lenders unless you see an option you like. Credible receives compensation if you close a loan with one of our partner lenders. The rates you receive and the fees you pay (if any) are not impacted by this compensation.


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