This Couple Got a $600K Mortgage for Their 1st Home — Despite Unconventional Finances

Armed with a degree in finance, Tyler Varnell was dutifully building his career. He spent five years working in corporate real estate until he had what he calls “kind of a mid-20s life crisis.”

At 27, he jumped out of the corporate world to pursue his dream: performing music. He’s spent the past two years playing saxophone and piano for weddings and events around the Los Angeles area. And he’s making it work.

“I’m not making as much as I was in my fancy corporate job,” he says, “but I’m definitely making a normal, sustainable amount.”

That’s good, because when he and his wife, Courtney, decided to buy a house, Tyler knew he’d need to demonstrate a steady income to qualify for a mortgage.

Then Courtney — who’s a registered nurse — found a $656,000 house for sale. Tyler’s reaction was, “Oh my gosh; there’s no way we can afford this. We’re gonna go broke.”

After lots of soul-searching and number-crunching, they ended up getting the loan they needed. And after entering talks with three different lenders, they went with Better Mortgage.

An Online Mortgage Lender Built Like a Tech Company

The couple chose Better because of how much money they’d save.

“With me being self-employed, underwriting my income was going to be tricky,” Tyler says. “Better did a great job helping us navigate the process and getting us approved, despite my unconventional finances. Better, by far, offered the most competitive combination of interest rate, lender incentives and zero lender fees.”

Better Mortgage bills itself as an online mortgage lender that’s built like a tech company — fast and innovative.

Its founder, financial entrepreneur Vishal Garg, launched the company after he got frustrated with the slow, inefficient, difficult process of getting a mortgage. His mission: Make the process faster, simpler and more transparent.

Buying a House in a Super Expensive City

Before buying their own place, the Varnells were renting a small house — 500 square feet, one bedroom, one bathroom, tiny kitchen, tiny living room.

Their dream was to own a four-bedroom home — space enough for a master bedroom, guest room, future kid’s room and a music studio.

Unfortunately, their home state of California is known for its astronomically high housing prices — especially in areas including Orange County, where they live.

“This is one of the most expensive markets in the nation, so finding something we could afford was the biggest challenge,” says Tyler.

It was Courtney who found the house while looking for deals on Zillow.

A fixer-upper in Huntington Beach. Priced in the mid-$600s.

“I know it’s really expensive,” Tyler recalls Courtney saying. “But this is a good deal for a single-family home in a good neighborhood. It needs some work. This is probably the best price we’re going to get.”

Tyler says after he finished freaking out, he sat down and ran the numbers. He wound up being swayed by the financial benefits of home ownership.

“I’m a finance guy, so I did a bunch of number-crunching, and it actually made sense for us, long-term, to buy the house,” he says. “Even though it makes us kind of ‘house poor,’ with a large percentage of our income going toward housing.”

“When you factor in home appreciation, the tax benefits and the fact that we’re paying down our principal — our net worth will increase faster than if we kept renting.”

An Online Process — With Human Help

Like any tech company, Better Mortgage emphasizes speed and efficiency. It can quote you an interest rate in seconds, once you type in your ZIP code, credit score range, down payment amount and the price of the house you want to buy.

It can get you an initial pre-approval for a loan within minutes, without affecting your credit score.

Although you apply for a loan online, you can also talk to an actual human being when you need to. You can book a phone call with a real, live loan officer who’s assigned to you.

“Better was quick to respond to our inquiries, both via email and telephone,” says Courtney. “Their representatives were knowledgeable and made the process relaxed and unpressured.”

That came in handy for Tyler, the self-employed musician. It’s easier for someone with a 9-to-5 office job to prove what their salary is. Tyler had to be able to show he had a steady income.

“If you’re self-employed, you have to be self-employed for two years,” he said, “and then they average your two years of net profit, and that’s how they determine your income.”

The couple had been in talks with two other lenders that couldn’t match Better’s terms.

“They had the best rate at 4.5%, while everyone else was at 4.75% or 4.825%,” says Tyler.

“The other two places had lender fees ranging from $400 to $1,500, and Better’s was zero. Then Better offered us $2,500 off of our closing costs.”

Better Mortgage requires a minimum credit score of 620 and a minimum down payment of 3%.

It operates in Arizona, California, Colorado, Connecticut, Florida, Georgia, Illinois, Iowa, Michigan, Mississippi, New Jersey, North Carolina, Oregon, Pennsylvania, South Dakota, Tennessee, Texas, Washington, D.C. and Washington.

‘A Dedicated Space for My Work’

The Varnells got the keys to their new house in September 2018.

“It feels so good to finally own a home!” says Courtney. “It’s an awesome accomplishment after years of financial sacrifices — eating out less, modest vacations and avoiding the mall.”

Before moving in, they started the “demo phase” of renovations — ripping out old carpet, removing old tile, scraping away popcorn ceilings.

Tyler’s sure it’ll be worth it — especially in the bedroom that’s destined to become his music studio.

Since he ditched the corporate life to follow his dream, he’s never really had a place to work on his music.

“Sometimes, I would take over half of our living room or half of our bedroom,” he says. “Now, I’m really excited to have a dedicated space for my work. And I think that’ll help with my business overall.”

Mike Brassfield ([email protected]) is a senior writer at The Penny Hoarder. He believes in the American Dream.