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Capital One is one of the largest banks in the United States, known for its credit cards, banking services, and auto loans. If you’ve been considering a mortgage loan, you might be wondering: Does Capital One do mortgages?
The short answer is no—Capital One no longer offers residential mortgage loans. In fact, the company exited the residential mortgage business several years ago. Let’s take a closer look at the details surrounding this decision and what it means for homeowners and potential borrowers.
Introduction: A Shift in Focus
Capital One was once a major player in the residential mortgage market. However, in 2017, the bank made a significant decision to step away from the mortgage business altogether. This change took place over the course of 2017 and 2018, marking the end of Capital One’s involvement in originating or servicing residential mortgage loans.
In this post, we’ll dive into the specifics of Capital One’s exit from the mortgage market, what it means for its customers, and how the bank’s focus has shifted to other areas of its business. Understanding this shift is important for anyone considering a mortgage or home loan options, and for those curious about the future of mortgage servicing.
Capital One’s Exit from the Mortgage Business
In November 2017, Capital One announced that it would be exiting the residential mortgage business. This decision was part of a broader strategic shift aimed at refocusing the company on areas where it saw the most growth potential.
The exit from the mortgage business was not abrupt but rather a gradual process that unfolded through 2017 and 2018.
The Reasons Behind the Exit
Capital One’s decision to step away from mortgages was driven by several factors. One of the primary reasons was the growing complexity of the mortgage market, which had changed significantly following the 2008 financial crisis.
The regulatory landscape surrounding mortgages had become more stringent, and managing this business became increasingly difficult for large banks.
Additionally, Capital One decided to refocus its efforts on other areas of its business that were deemed to have higher growth potential. The company’s emphasis shifted more towards credit cards, consumer banking, and commercial lending, where it saw a stronger opportunity to expand its customer base and increase profitability.
Does Capital One Do Mortgages?
As a result of the decision to exit the residential mortgage business, Capital One no longer originates or services any residential mortgage loans. This means that the bank is no longer offering new home loans or refinancing options to potential borrowers. If you’re looking for a mortgage from Capital One, you will not be able to find one.
However, Capital One’s existing customers who had mortgages at the time of the exit have not been left stranded. The company continues to service its existing portfolio of home loans, but it is not offering new mortgages.
What Happened to the Mortgages Capital One Already Held?
In May 2018, Capital One sold a significant portion of its mortgage portfolio to DLJ Mortgage Capital, Inc., a subsidiary of Credit Suisse AG. This sale amounted to around $17 billion worth of first and second lien mortgages.
By transferring these mortgages to DLJ, Capital One effectively exited the mortgage origination and servicing business, focusing on its other financial products instead.
While Capital One no longer offers new home loans, the bank still has a small role in mortgage servicing. The company continues to manage its existing loan portfolio, but it is not accepting new applications or providing new mortgage products.
What Does Capital One Do Now in the Mortgage Space?
Even though Capital One no longer offers traditional home loans, the company has not entirely abandoned the mortgage space. Instead, it has refocused its attention on specialized areas, such as multifamily financing for real estate developers and investors. This is a different aspect of the real estate market that Capital One continues to support.
Capital One also remains involved in mortgage servicing operations. This means that while it no longer originates new residential mortgages, the bank continues to manage existing home loans, ensuring that its customers can make their mortgage payments and access customer service for their accounts.
Additionally, Capital One evaluates strategic options for the future of its mortgage servicing operations. This means that while the company no longer issues new mortgages, it could still make decisions in the future about how to handle its mortgage-related services or expand into new types of real estate financing.
Implications for Homebuyers and Borrowers
If you were hoping to secure a mortgage through Capital One, you’ll need to look elsewhere. But what does this mean for those who may have already had a mortgage with Capital One before it exited the business?
For Existing Capital One Mortgage Holders
If you had a mortgage with Capital One prior to its exit from the mortgage business, you will continue to have the same loan terms and conditions. The primary change is that Capital One no longer originates new loans, but it still services the loans it currently holds.
This means you’ll make payments as usual, but there may be changes in how you interact with the bank if it eventually shifts its servicing strategy or sells its portfolio to another institution.
In short, Capital One is not in the business of issuing new mortgages, but it is still responsible for its existing home loan customers for the time being.
Alternatives for Homebuyers
If you’re in the market for a mortgage, there are plenty of alternative lenders who continue to offer home loans. Banks like Wells Fargo, Bank of America, and JPMorgan Chase, along with credit unions and online mortgage lenders, can provide a wide range of mortgage options.
These lenders still originate and service home loans, making them viable options for homebuyers looking for financing.
You might also want to explore different types of mortgages, such as fixed-rate loans, adjustable-rate mortgages (ARMs), and government-backed loans like FHA, VA, or USDA loans. Understanding your financial needs and the type of loan that suits your situation can help you make an informed decision.
Focus on Other Areas of Capital One’s Business
Although Capital One no longer offers residential mortgages, the company remains a strong player in other areas of banking.
Capital One is particularly well-known for its credit card offerings, including various options for people with different credit scores and needs. Additionally, the bank provides auto loans, savings accounts, checking accounts, and more.
Capital One also has a significant presence in commercial lending and specialized financing. The company’s involvement in multifamily financing for real estate developers highlights its continued interest in certain areas of real estate while steering clear of traditional mortgage origination.
The decision to step away from residential mortgages is part of Capital One’s broader strategy to streamline its offerings and focus on areas where it can provide the most value to its customers. This doesn’t mean Capital One is stepping away from banking—it’s simply choosing to focus on other aspects of the financial industry.
Frequently Asked Questions
Here are some of the related questions people also ask:
Does Capital One still offer mortgages?
No, Capital One exited the residential mortgage business in 2017 and 2018. They no longer offer new mortgages or refinance options. However, they continue to service existing home loans.
Why did Capital One stop offering mortgages?
Capital One decided to exit the mortgage business due to increasing regulatory complexity and a strategic shift to focus on more profitable areas, such as credit cards and commercial lending.
What happened to Capital One’s existing mortgages?
In May 2018, Capital One sold approximately $17 billion of its first and second lien mortgages to DLJ Mortgage Capital, Inc., a subsidiary of Credit Suisse. The company continues to service the existing mortgages but no longer originates new ones.
Can I still make mortgage payments to Capital One?
Yes, if you had a mortgage with Capital One prior to their exit from the mortgage business, you can continue making your mortgage payments. Capital One still services existing loans.
What is Capital One doing now in the mortgage space?
While Capital One no longer originates new mortgages, the company is still involved in mortgage servicing and specializes in multifamily financing for real estate developers and investors.
Are there any alternatives to Capital One for home loans?
Yes, there are many alternative lenders offering home loans, including large banks like Wells Fargo, Bank of America, and JPMorgan Chase, as well as online lenders and credit unions.
Who bought Capital One’s mortgage portfolio?
Capital One sold its residential mortgage portfolio to DLJ Mortgage Capital, Inc., a subsidiary of Credit Suisse AG, in May 2018. This included $17 billion worth of first and second lien mortgages.
Can I still get a home loan if I’m a Capital One customer?
Capital One no longer offers new home loans, so current customers seeking a mortgage will need to explore other lenders. However, Capital One will continue servicing existing home loans.
What is Capital One focusing on now that it no longer offers mortgages?
Capital One has refocused its business on areas like credit cards, auto loans, and commercial lending, as well as specialized real estate financing for multifamily projects.
The Bottom Line
So, does Capital One do mortgages? No, Capital One no longer offers residential mortgages. After exiting the mortgage business in 2017 and 2018, the company sold a significant portion of its mortgage portfolio and refocused its efforts on other areas of finance, such as credit cards, auto loans, and multifamily financing.
While Capital One is not offering new home loans, it still services its existing mortgage portfolio and evaluates its strategic options in the mortgage space.
For those looking for a mortgage, plenty of other lenders are still offering competitive loan options. If you’re a current Capital One mortgage customer, your loan terms remain the same, and the bank continues to service your loan. However, if you need a new mortgage, you will need to look for other lenders who are still active in the home loan market.
Ultimately, Capital One’s exit from the mortgage business marks a shift in its strategy, but it remains a major player in other parts of the financial world. Whether you’re in need of a credit card, a car loan, or specialized real estate financing, Capital One continues to be a major option for your financial needs.