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Zigzy (NMLS# 6606) is a Texas-based online mortgage company. The fintech company serves all states except New York and Hawaii and gives buyers the unique opportunity to purchase a home with an all-cash offer because it fronts buyers the cash based on creditworthiness and then rolls the loan into a standard mortgage repayment plan.
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- 100% digital application
- $2,500 lender credit
- USDA, FHA and VA loans
- Service fees
- Not for condos or manufactured homes
Zigzy offers buyers a fully underwritten mortgage preapproval that qualifies them to be all-cash buyers. After the home is bought, buyers will have a fixed- or variable-rate term through New American Funding.
Zigzy uses New American Funding to fund all of its loans. New American Funding publishes its starting mortgage rates for conventional, FHA, USDA, VA and jumbo loans. Aside from the traditional 15- and 30- year fixed rate mortgage, New American Funding offers customized terms ranging from eight to 30 years.
New American Funding’s rates stay very close to the national average. In 2021, the home purchase rate through New American Funding was only 0.05% higher than the national average, and in 2020, it was 0.07% below.
Adjustable-rate mortgages (ARMs) can offer you rate flexibility and a lower initial rate, depending on the lender. For example, New American Funding offers ARMs with initial fixed-rate periods of seven and 10 years. The first number on an ARM is the number of years your mortgage is at a fixed rate. The second number indicates how often your mortgage rate changes after.
New American Funding average home purchase rate vs. national average
|Year||Difference from national average|
Zigzy offers a completely digital application process for potential buyers to get a fully underwritten preapproval. Before the official application, you can complete an interest questionnaire within a few minutes. For this step, you don’t need any documentation or login; just provide your name, whether you want to buy or refinance, and your estimated home and credit score details.
During the preapproval process, you will need to provide income verification and your Social Security number. This preapproval process serves two purposes: to know how much you can afford on a home and become a qualified cash buyer.
The cash buyer option is for applicants deemed most creditworthy, and it is not the only option available. You can choose to skip that option and choose one of the flexible mortgage terms through Zigzy’s direct lender, New American Funding.
For those wishing to do the cash buyer option, you don’t need to have the cash upfront. Zigzy connects qualified buyers with an affiliated real estate company that buys your home with an all-cash offer. Once you move in, you buy your home from the company once your mortgage is secured.
Zigzy application features
|Mobile document upload|
|Publishes minimum rate on website|
|Pre-qualification (no hard credit pull)||X|
|Certified approval letter|
When you work with Zigzy, you are essentially working with two different companies. First, you work with Zigzy to get preapproved for a cash offer and loan. If you choose the cash offer option, Zigzy will provide the cash you need to make an all-cash offer on your desired home. This helps you competitively put an offer on a home, and your home purchase should go through faster.
Once the home is yours, Zigzy rolls your account into a traditional home mortgage for repayment. Since Zigzy works directly with New American Funding, there are several different loan options to choose from.
- Conventional: New American Funding offers loan terms between 10 and 30 years with as little as 3% down.
- Government-backed loans: USDA, VA and FHA loans are all available. These loans have lower credit score requirements and require 0% to 3.5% down.
- I CAN Mortgage: Choose your own mortgage term between eight and 30 years.
- Jumbo loans: These loans are for home purchase prices that exceed Fannie Mae and Freddie Mac's conforming loan limits. New American Funding offers financing up to $3 million.
Loan applications for home purchases only by year
|Home purchase applications||57,519||54,156||47,730|
|Home purchase loans closed||41,636||39,518||35,062|
|Home purchase applications denied||2,498||2,055||1,905|
|Home purchase preapprovals denied||1||52||31|
Zigzy also offers the option to refinance your home loan. Through New American Funding, Zigzy customers can do a cash-out refinance to use for a variety of purposes, such as paying for college or doing home repairs. Additionally, those wishing to refinance to a better term or rate without tapping into equity can also do that.
In 2021, when refinancing was popular because of low rates, over 56% of New American Funding home loans were for rate-and-term and cash-out refinances.
Home purchase vs. refinance loans by year
|Home purchase loans||40.29%||38.41%||62.23%|
Zigzy’s application process helps you figure out how much home you can afford, so you aren’t tempted by homes out of your budget. Zigzy does not disclose specific credit scores or income requirements for the cash-buyer option. Its direct lender, New American Funding, does require a credit score of 620 and at least 3% down for a conventional loan, though.
National mortgage requirements by type
|Min. credit score||Min. down payment||Compare with other lenders|
|Conventional||Typically 620||Typically 3%||Mortgage lenders|
|FHA||500||3.5% with 580 credit score||FHA lenders|
|VA||Set by lender (often 580)||0%||VA lenders|
|USDA||Set by lender (often 640)||0%||USDA lenders|
Cost and fees
Zigzy charges a one-time service fee for buyers who want to use the all-cash buying option. This fee varies on which state you are in, but Zigzy will disclose it during the preapproval process.
Zigzy does not charge any fees for buyers who wish to use its real estate agent matching service. In fact, buyers who use one of Zigzy’s preferred agents can receive up to a $2,500 lender credit to be applied toward closing costs at the close of escrow.
All home purchases and refinances also come with origination fees and closing costs. These fees vary by lender, but you can expect to pay between 2% and 5% of your home’s purchase price. These fees cover taxes, home appraisal fees, title fees and more.
What is Zigzy?
Zigzy is a unique online mortgage company that gives buyers a fully underwritten preapproval. This preapproval gives the buyer the option to purchase a home with an all-cash offer and then switch to a flexible mortgage term of their choice.
Is Zigzy legit?
Zigzy was founded as a new way for homeowners to buy a property with all-cash offers. Zigzy works directly with established mortgage lender New American Funding, which has been around since 2003.
Where is Zigzy available?
Zigzy is available in every state except New York and Hawaii.
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