Digital Federal Credit Union prides itself on a member-focused, ethical approach to lending. Founded in 1979, the Marblehead, Massachusetts-based credit union offers a wide range of business and consumer loans. DCU was established in 1979 to provide employee benefits for the Digital Equipment Corporation, and its focus on meeting the needs of digital users remains.
DCU Mortgage Facts
- Membership is available to those who work for partner organizations or communities, and their direct family members
- Heavily focused on online services, providing convenience and accessibility
- Serves the entire nation, but all of its branches are in New England
- Defines itself as an organization that emphasizes ethical practices and determining how it can help its members on a day-to-day basis
- Website offers a diverse array of resources to help potential borrowers understand the lending process
- Offers real estate services to help members find a home once they have a mortgage
- Provides customer support for the life of the loan
Overall
DCU stands out for the breadth of financial services it offers. Its origin as a source of employee benefits for a fast-growing organization has helped to fuel expansion into crucial areas such as real estate and insurance, allowing DCU to take a somewhat unique approach to holistically serving customers.
In its mortgage lending products, this comes forth in a fairly standard package of available loans, including VA mortgages, fixed-rate mortgages, and adjustable-rate mortgages, all of which are backed by customer support directly through DCU for the life of the loan.
These types of robust customer support solutions are only available to members, but if you are part of the credit union, DCU can provide a convenient, accessible lending experience that is a natural fit for first-time home-buyers.
Current DCU Mortgage Rates
DCU Loan Specifics
DCU is a credit union, so you must consider eligibility as the first benchmark for whether their mortgages are a fit for you or not. Access to membership is primarily based on being employed by a company or organization that has opted to partner with DCU. Like other credit unions, this membership then extends to direct family members of that employee. DCU also partners with a few towns and cities in Massachusetts and Georgia, offering membership to residents in those locales.
Their actual mortgages are relatively standard for the mortgage industry, but like many credit unions tend to come at slightly lower rates. Here’s a look at their primary mortgage offerings:
Fixed-rate loans
The fixed rate loan product from DCU is designed for individuals who anticipate living in the home they are purchasing for an extended period of time. Fixed rate loans tend to have a slightly higher initial interest rate than adjustable-rate mortgages, but they come with certainty about long-term payments. The DCU fixed-rate mortgage comes with a max term of 30 years and is available in two formats:
- Conforming: For loans of up to $453,100 and covering up to 95 percent of the home’s value.
- Jumbo: For loans over $453,100 and covering as much as 90 percent of the home’s value.
DCU mortgage rates for fixed-year loans went as low as 4.33 percent for 10-year terms as of 11/15/2018. It’s worth noting that APRs generally shift based on the length of the loan. This loan format is supported by a special 3 percent down program, in which borrowers seeking a 1-unit primary residence with a 30-year loan program can take advantage of lender-paid mortgage insurance. This benefit comes together with a no points and no points/no closing cost option to make the DCU fixed-rate mortgage a natural fit for first-time home-buyers.
Adjustable-rate loans
The adjustable-rate mortgage from DCU is designed for those who want to get the best possible rate at the start of the loan, but aren’t too worried about an increase in future payments. This could be the case if you plan to move again within five years or so or if you’re expecting your income to increase significantly over the course of the loan.
DCU mortgage rates for this loan start at 4.98 percent for the first five years, with terms available for up to 30 years. It’s possible to arrange the fixed rate term for the loan to extend to seven or 10 years as well.
Like the fixed-rate loan, the adjustable-rate mortgage is available in conforming or jumbo parameters, with the same parameters in place.
It’s worth noting that DCU’s adjustable and fixed-rate mortgages come with a 60-day rate lock, ensuring that you don’t have to renegotiate terms if you get pre-approved and take some time to finalize your new home purchase.
VA loans
While adjustable and fixed-rate loans are the primary mortgage products available from DCU, the organization does also offer VA mortgages. These are structured similarly to VA loans at other institutions in terms of availability. A down payment is not required for the loan, but it will generally have a higher than average interest rate as a result.
While DCU focuses on a relatively small number of mortgage options, its emphasis on service for the life of the loan and optional solutions within each mortgage showcase the institution’s dedication to member-focused lending.
DCU Mortgage Customer Experience
DCU operates many branches spread throughout New England, but its website and other digital channels define its services. Approximately half of DCU’s members never visit a branch. This identity as a digital financial services organization extends through the DCU website. Searching for mortgage rates online is easy, and DCU provides a variety of resources to simplify the process, including:
- Mortgage calculators that make it easier to determine payments and identify what you can afford.
- A tool that lets you generate a free personalized quote online, without having to provide your Social Security Number.
- Videos providing background information on the lending process and answering common questions about mortgages and the home-buying process.
- A resource center that lets you select your mortgage goal and be connected to relevant materials to help you learn more about how DCU can help you achieve that goal.
These resources are backed by a powerful digital service model that lets you complete every facet of the lending process online. It’s worth noting that while DCU does operate some branches, they are all in New England, even though the credit union serves every state in the U.S. Many customers will go through the entire mortgage process online or via phone.
Customer reviews on the DCU site tend to be extremely positive, but they should be taken with a grain of salt as the closed nature of a credit union membership limits the scale and public scrutiny placed on the institution. J.D. Power’s doesn’t even include DCU in its Primary Mortgage Originator Rankings, and the Consumer Financial Protection Bureau doesn’t track consumer complaints for the institution.
DCU Lender Reputation
DCU doesn’t have a particularly long history. It’s identity as a lender is deeply tied to the rise of computing and digital services in the country. It was founded in 1979 and only reached its current state as a federal credit union in 1999. It didn’t open its first freestanding branch until 1996 and currently only has 22 branches. However, it serves more than 500,000 members and has put its emphasis on functioning as a financial cooperative for its membership.
The institution is insured by the NCUA and certified as an Equal Housing Lender. It also participates in the Nationwide Mortgage Licensing System. Its ID number is 466914.
Ultimately, understanding DCU’s reputation is really a matter of determining your personal level of comfort with the institution. It received a B- rating from the Better Business Bureau, but that only covers branches and is a result of a failure to respond to four complaints. There have only been 66 complaints against DCU with the BBB in the past three years, creating such a small sample size that the rating isn’t particularly helpful. Similarly, there is only one review for DCU on file with Trustpilot. It’s a glowing review.
You can only access DCU mortgages if you’re already a member, so this is one area where you may need to trust your personal experience more than online reviews. If you’re still thinking about joining, consider speaking with co-workers, family members, or neighbors who are members, depending on how you qualify for joining, to get a sense of their experience. In most cases, DCU is too small and too much of a closed community to be covered by most industry-wide studies.
- Information collected on Nov. 15, 2018
DCU Mortgage Qualifications
|
Down Payment Requirement |
Lifetime Service With DCU |
Jumbo Loan Available |
|
|
Fixed-Rate Loans |
5% minimum for conforming loan. |
Yes |
Yes, with 10% minimum down payment. |
|
Adjustable-Rate Loans |
5% minimum for conforming loan. |
Yes |
Yes, with 10% minimum down payment. |
|
VA Loans |
None |
Yes |
Only under special circumstances. |
Qualification requirements for DCU loans are relatively standard. While details can vary significantly depending on your specific situation, you can generally use gift money for down payments and will need private mortgage insurance if your down payment is for less than 20 percent of the property’s value.
DCU Phone Number & Additional Details
- Homepage URL: https://www.dcu.org/
- Company Phone: 800.328.8797
- Headquarters Address: 220 Donald Lynch Boulevard, Marlborough, MA 01752-9130
- States Serviced: Nationwide
The post DCU Mortgage Rates Review: Today’s Best Analysis appeared first on Good Financial Cents®.
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