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Discover Mortgage Review

There’s a new lender hanging out their shingle in the marketplace, Discover Mortgage Loans. Should you trust Discover Mortgage Rates for your next home loan and how do their purchase and refinance rates stack up against the best mortgage lenders like Amerisave? Here is my unbiased review of Discover Mortgage services, interest rates and fees to help you make an informed decision without walking away from cash on the table.

Discover Mortgage Rates

Does it pay to Discover when it comes to your home loan?

Discover recently entered the mortgage marketplace. How do they stack up to other lenders when it comes to mortgage rates and fees?

Rating by Robert Regehr: 1.0 stars

Discover Mortgage Profile

Discover Mortgage got into the game by purchasing Lending Tree. Their trademark “When Banks Compete, You Win” is a familiar selling proposition from TV and internet. Discover mortgages is currently offering purchase and refinance mortgage loans with fixed and adjustable interest rates and FHA home loans. For mortgage refinancing their loans are both rate and term refinancing as well as cash-out.

At the time of this review the Adjustable Rate Mortgage (ARM) options included 3/1, 5/1, and 7/1 ARMs, but no 10-year ARM. FHA home loans included a 15 and 30-year term length. Discover Mortgage seems to only offer conforming home loans at this time so if you’re in need of a Jumbo Mortgage you’ll need a different lender. They claim that their streamlined application process makes approval easier than with the top mortgage lenders online.

Discover Mortgage offers an on-time closing commitment, meaning if your mortgage isn’t funded on schedule you get a $1000 credit towards your closing costs. If you continue to refinance with Discover Mortgage you will earn their “Welcome Back” bonus of up to $2000 paid towards lender fees.

Discover Mortgage Contact Information



By Phone:


By Mail:

Discover Bank
PO Box 30416
Salt Lake City, UT 84130

Discover Mortgage Rates Review

Most people focus solely on getting the lowest purchase and refinance rates, often at the expense of fees. How does Discover Mortgage stack up when compared to other lenders? I looked at the rates published on the website and they’re currently advertising a 30-year fixed rate mortgage for 3.75 percent.

The problem is when you check the fine print you have to pay 1.125 discount points AND qualify based on single family, owner-occupied with a loan-to-value of 70% or better and a credit score of 720 or better. Paying that amount at closing for discount points is simply ridiculous. Some of the most common mortgage mistakes are paying unnecessary discount points and overpaying the loan origination fee. Based on these requirements it seems that this lender is only interested in borrowers with above average financials.

The website gives an Annual Percentage Rate but does not disclose details about their loan origination fee. Paying one percent for loan origination is standard; however, many lenders charge more BUT you can find loan origination fees as low as a flat $700 by shopping local, community based credit unions.

Discover mortgage rates, like their credit card come with a slick package and celebrity voice overs; however, if you want the best deal for your next home loan you might want to give Discover mortgage rates a wide berth.

You can learn more about paying less for your next mortgage by checking out my free Underground Mortgage Videos.

{ 13 comments… add one }
  • Jamieson Rhyne July 2, 2012, 6:11 pm

    The origination fee is 0.25% of the loan.

  • Paul Wills August 7, 2012, 9:15 am

    Worst service I ever had.
    If you are prepare to: work harder than the service workers at Discover, have lack of communication, and deal with a service offering institution that does not now the rules, regulations, and how to process loans this is the place for you.

  • Marty Schneider October 6, 2012, 6:05 pm

    I refinanced with them and it was such a hassel. I had a competative offer that they matched and gave me .5 discount points on my loan. Went out of town for a few days and my loan was canceled. When I contacted them upon my return that I intended to proceed with the loan they said everything was fine. Then I get my hud statement the day before my closing and the discount points changed from .5 to .25?!? Bait and switch Used car salesman tactics IMHO!

  • Rachel November 21, 2012, 10:11 am

    In the process of buying a home with them right now. This is the second closing date. The first one they canceled an hour prior to closing due to not having a review appraisal completed yet. This closing is at 3 pm today, we are sitting on the edge of our seats, because we are waiting for the final underwriting sign off….it’s 12 and we still don’t know.

    It has really been a nightmare (no credit issues of any sort — they are just fussing around about the value of the home — even though it is appraising for more than we are taking a loan for). We are within a week of falling out of escrow because of all the crap they have put us through with appraisals…the home has been appraised twice now, for the exact same value. They tried to require a third (field review) yesterday because they say we live in a depressed area (Michigan). Finally they removed that requirement and sent it for final underwriting approval at 2 pm yesterday….now everyone is sitting waiting to see if it will go through today…. of course nobody there is answering my phone calls or emails right now….. title office, listing agent, buyers agent, and husband, all keep calling me to see what I know. I hope we close today so I can finally get some sleep!

  • Molly March 20, 2013, 5:17 pm

    I agree 100% with everyone above. I’ve literally given them everything they’ve ever asked for, and then some…I feel like the next thing they’re going to ask for is my first-born, a la Rumplestiltskin. I’m getting extremely frustrated – my loan has been almost 4 weeks in “underwriting”, with no end in sight. The closing date has come and gone. No one ever answers the phone, but they’ll call you back seconds after you leave a message. I was pre-approved with them knowing, from literally the very first conversation, of my finances and the unusual circumstances surrounding them (alimony, bartender, self-reporting, cash payments, etc), but have also uploaded every item supporting these so that they know exactly where my money comes from, and where it goes. I’m not trying to hide anything. However, every hour or so, it seems like there’s another “question” that only I can answer, even though it is simple enough to follow the paper trail.
    After 2 weeks in underwriting, they came back saying I needed a co-signer. Fine. I had secured that person within hours, and by the end of 48 hours, I had all that person’s required documents uploaded.
    After calling daily for over a week to see if I could at least get a “guesstimate” of when the loan would either be approved or denied, I was given a follow-up phone call by one of the 4 people working on my loan, who explained she’d been sick. Totally get that people get sick, but no one else is working on this? Seriously? And then she had a list of things that needed “clarified” by the underwriter. All of which was easily found and explained in every document I had uploaded to My Status. Apparently the underwriter couldn’t be bothered to actually look for herself?

    All in all, I’m totally disgusted by what’s going on, and am at the point where I truly don’t care if I get this house or not. This whole process has been frustrating and stressful, and I can certainly say I would not recommend Discover Home Loans to anyone looking to purchase or refinance a home. I know I certainly will never use them again.

    • Valentina March 26, 2013, 8:36 pm

      Molly, what happen with your loan? Did you get approval?

  • Murphy May 5, 2013, 5:23 pm

    My experience with Discover Home Loans has been anything but satisfactory. My initial contact with the banker was exemplary. Once I was passed for loan approval, contact virtually stopped. I was unable to establish contact with loan approval unless I called someone else first and voiced my displeasure. Leaving a voice message with a supervisor got me the most immediate response from loan approval who took that opportunity to request additional documents because by then the originals were too old to use in the verification process. All this time the “my status” page showed the loans to be in closing. After telling loan approval I did not want to continue with this process and would take my business elsewhere, he waited one week and then both called and left a voice message and emailed me (his first attempt to email me). He did say he had tried to call me but could not get through. We did have a one day in three different weeks where the phone company was doing their thing and the phone line was down. My email was never down and there is no indication that my cell phone was called. This process has dragged on for four months now with no end in sight. I have called it quits. I will have to accept this as a very expensive lesson in doing business with wannabe lenders. I responded to loan approval and Discover Home Loans with the following.
    I received your phone message and email on Thursday. I took a couple days to work out just how to word my response so you could understand. I find it simply amazing that at long last (too late) that you do know how to use email. I tried several times both on the phone and via email to contact you requesting updates. The only times I received a response from you is when I contacted someone else requesting assistance, once through banker, once through account manager, and twice through Customer Service. I advised account manager, because you did not respond within two days and did not answer your direct number, that we were going on a trip and would not be home for ten days but would have our cell phone (I gave him the number) and email. We got home after ten days to find two voice messages from you, the first within three days of our departure. I did not receive a call on the cell phone or an email from you. During our travel I did receive an email from one remittance provider forwarding an email from another person at Discover Home Loans saying we needed to send the request for information to another office. I forwarded that email to the person at Discover Home Loans. You knew nothing of this transaction a week later when I established contact with you on our return. If, as every contact with your company states, calls are monitored, your and my attempts should be readily tracked. Also my attempts via email should be on record. I responded with the documents requested each and every time even though I was getting frustrated after three months. This fiasco has cost me $1639.25 ($1200.00 for appraisals and $439.25 for attorney fees to remove the properties from trust). Later you requested trust paperwork indicating that this would have been unnecessary. Of course I will still have to pay a similar amount to replace the properties into the trust. I presume this is just the cost of doing business with a non-reputable company. I personally and with my wife have had one to four mortgages since 1969 (44 years) and have never missed a payment or been late for one. We have excellent credit ratings and submitted more than enough paperwork to justify our requests to refinance our loans for a shorter term and better interest rates. We were not asking for any additional monies. I can understand some of the changes required after the banks screwed everybody, but find your explanations for demanding more and more information despicable. I could have been much more understanding had someone had the courtesy to return my calls or contact me and explain the situation and problems much earlier in the process. To contact me only when the documents submitted were too old to work with I find abhorrent. In short, yes I do want to discontinue this loan request. I will not be working with you further, now or in the long term future.

  • Lazaro Suarez July 24, 2013, 10:34 am

    I agree with all the statement above, and now have a lawyer working on my behalf. An additional expense, but well worth the expense, let the buyer be aware. This company is a shark, and they blame the appraiser. The real issue is the big banks….

  • Alan Bryant July 31, 2013, 7:42 pm

    I have had wonderful time with Discovery loan . I gave up my $400 immediate so that I could get a “lock in” on my rates, points and origination fee. A lock in agreement was emailed to me, It was sent by email this lock in agreement, I had a phone conversation which as all consistent with this lock-in agreement. Last week I was sent an email saying that they had mistakenly unlock the agreement and now I owe $500 more for my loan, I reply that I had agreed to the original amount only. This week the home now needs the roof replaced even though the inspection said nothing about replacing the roof. Of course my lock in date ends next week. I wish I did business with the local bank.

  • Lily August 27, 2013, 5:07 pm

    I decided not to go with Discover home loans, and have requested a refund for the house inspection which was never done. It has been 2 weeks, and I have yet to receive it. The agent said he forgot to send it due to a family member being sick, and he promised to expedite sending it, but so far it had been two weeks, and I am still waiting. I may have to go through a small claims court. Has anyone had this happen?

  • James July 16, 2014, 6:20 pm

    Discover Home Loans has been the primary reason my family is currently homeless. Each day we’re told we’ve submitted everything we need only to be told a few hours later there is another document they need submitted. I was told they need a letter from my employer stating my employment status. No problem right? Wrong, after obtaining the document they said it doesn’t work because it doesn’t contain an income statement. We get another letter (this time with an income verification) and they tell us we needed the Fannie Mae form for this purpose. Why didn’t they tell us this the first time? Only the Lord knows. This is just one example of one document. I can provide other examples, but my advice based on my experience is to tell you to RUN away from this company. FYI, I have an OVER 800 credit score, I’m putting almost 1/3 of the value of the home down, and it appraised for much more than the borrowing price. I can assure you if I’m going through it the chances are good you will too.

    • Shruti July 29, 2014, 1:27 pm

      Thanks James and others to have send the reviews. I was very much in dilemma to choose between Discover and another local lender in NJ. I really liked the Mortgage banker in discover who I talked to initially. But Since James your experience is so recent and you have taken the effort to warn others, I am going to try to save my self from going through the agony. I just hope this company that I am deciding to go with is better. Fingers crossed.

  • Scott February 1, 2017, 11:16 am

    My wife and I are in our late 50’s, retired, and have excellent income. We have owned many homes, and have acquired many different loans over the years, so have a good understanding of the process. We Started our loan process October 22,2016. Like the previous review, we were told six to eight weeks. Wanted all of our paper work filed immediately, which we did, we were approved etc. etc. Then the fun started! We were handed off to various loan agents who lied, pointed fingers at each other, stalled, claimed things were done, when they weren’t, and never returned phone calls! When we call to try to talk to a supervisor, we are told a variety of things, everything from they’ve gone home for the day, or, they will get back to you in 48 hours, they never do. It’s now January 31st, 2017, and we are done. My advise…run from these idiots as fast as you can! The problems with this company are systemic from top to bottom.

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