Rate (formerly known as Guaranteed Rate) has linked up with Betterment to deliver some big mortgage rate discounts.
If you’re a current Betterment customer with at least $100,000 in assets on the Betterment platform, you can snag both a discounted mortgage rate and reduced closing costs.
All you have to do is apply for a home loan through Rate using the Betterment website link to get your discounts applied.
The new partnership is available to new home buyers nationwide (it excludes refinances for existing homeowners).
And will be available until at least December 31st, 2026.
How the Betterment Mortgage Rate Discount Works
As noted, to get the discount you need to use the special link from the Betterment website.
And you must do so by December 31st, 2026 unless it gets extended further beyond that date.
You also need to have at least $100,000 in assets on the Betterment platform to be eligible for the discount.
If applying with a co-borrower, your combined household balance may be used to meet the $100,000 requirement.
The $100,00 can be a combination of cash and investments, so there’s no specific security type required.
From there, you can get the discount if you’re buying a home (no mortgage refinance discounts here).
The property must be your primary residence, meaning the one you live in most of the year, and a single-family, detached home. Presumably no condos!
No second homes (vacation properties) or investment properties are eligible either.
In addition, you need to take out either an FHA loan or a conventional loan, aka those backed by Fannie Mae or Freddie Mac.
It appears VA loans, USDA loans, and jumbo loans are not eligible for this mortgage rate promotion.
Finally, the loan type must be a 30-year fixed rate mortgage. Fortunately most home buyers choose that particular loan product.
But it means you can’t get the discount on a 15-year fixed mortgage, or an adjustable-rate mortgage, such as a 7/6 ARM.
What Is the Mortgage Rate Discount Based On?
I dug into the fine print and discovered that the companies are using the national average mortgage rate as published by Mortgage News Daily each day.
At last glance, this rate was 6.04% for a 30-year fixed mortgage. Whether that means you get a rate of 5.29% remains to be seen.
The promotion says “up to a 0.75% interest rate discount.” In other words, it might be lower than that.
It also says the discount assumes a $500,000 loan amount, 780 FICO score and 75% loan-to-value ratio (LTV).
My guess is borrowers with less vanilla scenarios, whether it’s a smaller down payment and/or a lower FICO score may receive a smaller rate discount.
So you’ll need to go through the process to determine what the exact discount is based on your particular loan scenario.
You do appear to get a $500 closing cost credit as well, which happens to match the Robinhood Sage Home Loans discount exactly.
In other words, Betterment and Rate seems to be following in the footsteps of their competitors here.
Is This a Good Deal?
Whenever I come across rate discounts, I ask this question. Is it a good deal?
The million-dollar answer to that question is that it depends on the final rate and closing costs and what you can get elsewhere.
For example, say Betterment and Rate offer 0.75% off my rate and give me a $500 closing cost credit.
And that gets me a 30-year fixed at 5.50% with say $2,500 in fees. Remember, there will likely still be fees, even if they are slightly discounted.
What if a different bank, lender, or mortgage broker can offer me a rate of 5.75% with no fees, or 5.50% with only $1,000 in fees?
Then it won’t matter that I received a “discount” right? It’ll mean I’m paying more versus other, superior options.
In other words, you still need to shop around and see what else is out there. They might turn out to have the best deal, but they might not.
Only way to know for sure is to put in the time to speak with multiple lenders before you proceed to lock in a rate.
Before creating this site, I worked as an account executive for a wholesale mortgage lender in Los Angeles. My hands-on experience in the early 2000s inspired me to begin writing about mortgages 19 years ago to help prospective (and existing) home buyers better navigate the home loan process. Follow me on X for hot takes.