New American Funding: 2025 Home Equity Review

New American Funding overview

Founded as a 40-employee call center in Orange County, California in 2003, New American Funding opened its first branch in 2012. Today, it has more than 285 locations across the country. A specialist in home-based financing, its servicing portfolio includes more than 270,000 loans valued at $71 billion.The company runs several initiatives designed to help different categories of borrowers, including people of color, veterans and members of the LGBTQ+ community. 

Home equity loan products offered

New American Funding HELOCs are available on a primary residence, secondary residence or investment property. Depending on your home’s value and level of equity, you could borrow as much as $400,000. The minimum is $25,000 ($35,000 in Texas).

However, unlike some other HELOC lenders, you’re required to draw all of these funds initially; you can then draw more as you repay what you initially borrowed. The minimum amount for a subsequent draw is $500, except for Texas, where it is $4,000.

The initial draw incurs a fixed interest rate. Any redraws will be charged interest based on the current Wall Street Journal’s Prime Rate. This prevailing market rate might be higher than the initial rate. The most competitive HELOC rates go to well-qualified borrowers who set up auto-pay.

The loan draw period is based on the initial term you select:

• 5 year term: Draw period = 2 years 
• 10 year term: Draw period = 3 years 
• 15 year term: Draw period = 4 years 
• 30 year term: Draw period = 5 years

Your repayment period would then begin after your draw period ends.

Pros and cons of New American Funding

How Bankrate scored New American Funding

Affordability: 3.2/5

• APR: New American Funding doesn’t advertise the rates it offers on HELOCs, nor is it transparent about any fees that would factor into the annual percentage rate (APR).
• Introductory APR: NAF line of credit comes with a fixed interest rate on the initial draw, which is the entire credit line. This is an unusual feature.
• Fees: NAR charges a 4.99 percent origination fee on HELOCs, and borrowers may need to pay for an appraisal and their local recording fee, too.

Because New American Funding isn’t transparent about its current HELOC rates and charges a hefty origination fee, we scored it 3.2 out of 5 in terms of affordability. 

Availability: 4.6/5

• Loan products: New American Funding doesn’t offer home equity loans, only HELOCs. 
• Footprint: While NAF is licensed in all 50 states, it doesn’t offer HELOCs in Hawaii, Kentucky, New York or West Virginia.
• Credit score: NAF’s credit score minimum for HELOCS (620) is comparable to other lenders — somewhat on the low end.
• Loan minimum: NAF’s $25,000 minimum is a typical amount for home equity financing. 
• Draw requirement: Borrowers have to withdraw 100% of the entire credit line at the time of closing, which is uncommon. 

While it loses points because it doesn’t offer home equity loans, the widespread availability of its HELOCs earn NAF a 4.6 out of 5 in terms of availability. 

Borrower experience: 3.6/5

• Rate transparency: This is NAF’s biggest shortcoming. It lists no HELOC rates online at all, not even a ceiling, as most lenders do.
• Convenience: The fully online process — including an online notary option — makes it relatively easy to apply and close. 
• Customer service: NAF offers a customer care portal to its borrowers and has a dedicated email address and phone number for customer service. 
• Fixed-rate options:, NAF’s HELOC comes with a fixed rate on the initial draw, and then a different fixed rate for additional draws. So, unlike most variable-rate HELOCs, the borrower has no control over locking in a rate.

We ding NAF heavily for its lack of rate transparency, and lack of borrower option in setting a fixed rate. Its online application helps it regain some points. As a result, we gave it a score of 3.6 out of 5 for borrower experience.

How to qualify for a HELOC with New American Funding

To qualify for a HELOC with New American Funding, you’ll need a credit score of at least 620 and at least 15 percent percent equity in your home. Like many types of home loans, the debt-to-income (DTI) ratio caps out at 43 percent. You’ll also need to have sufficient steady income and meet other eligibility criteria, such as having homeowners insurance.

How to apply with New American Funding

You can apply for a New American Funding HELOC on the lender’s dedicated HELOC website. The lender allows you to link your current financial accounts in the online application, which can help speed up the process. New American Funding is also available by phone at 888-964-7404, Monday through Sunday, 6 a.m. to 5 p.m. PT.

New American Funding reputation

NAF fares fairly well in terms of its public standing. It has an A+ and 4.45 out of 5 stars with the Better Business Bureau. 

As a mortgage servicer, it scored a little below average in the most recent J.D. Power Mortgage Origination Satisfaction Study. On the servicing side, though, NAF knocks it out of the park. In 2022, it topped the list for the J.D. Power Mortgage Servicer Satisfaction Study. Last year, it fell a few spots but still scored well above average.