PenFed Review StaffNov. 15, 2020

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In a Nutshell

Pentagon Federal Credit Union serves the millions of Americans connected with the Armed Forces, Department of Defense, and defense industry. PenFed provides a range of financial services including mortgages, loans, checking accounts, and credit cards. In terms of mortgages, it offers conforming/conventional loans, VA loans, and home equity loans and lines of credit.


  • Caters to Americans who have served their country
  • Offers discounted rates when using network agent
  • Free 60-day rate lock on some mortgages


  • Doesn’t offer FHA loans
  • Borrowers must maintain credit union membership

PenFed at a Glance

Loan types:Purchase, Refinance, Home Equity
Featured Loans:Conforming, Non-Conforming, Jumbo, VA
Repayment terms:10-30 years
Minimum Down Payment:0-20%
Minimum Credit Score:620
Suitable for:Active and retired servicepeople looking to get a home loan with a low down payment

PenFed-QS PenFed-QS Visit PenFed


PenFed is the second largest credit union in the United States, serving the entire defense establishment. Anyone who serves or has served in the Armed Forces, works for the US Government or Department of Defense, or works for or has membership in any of around 170 qualifying organizations, may obtain PenFed membership and apply for a loan. PenFed specializes in VA loans. It also offers conventional mortgages, refinancing, and home equity products with competitive rates and low down payments.

Suitable For?

As mentioned, PenFed accepts people from around 170 qualifying organizations. The full list, which can be found with the mortgage application form on PenFed’s website, contains a range of defense-related organizations in the private, public and non-profit sectors.

PenFed is right for:

  • Getting a home loan with a low down payment
  • Starting out your mortgage with low initial monthly payments
  • Drawing on your home equity with a home equity loan or line of credit

Types of Loans

PenFed specializes in VA loans, but this isn’t the only thing it offers. With PenFed, borrowers can obtain conventional loans with options like low down payments and flexible monthly payments.

Here’s the full list of PenFed mortgage products:

  • Conforming mortgage

    Regular fixed-rate or adjustable rate mortgages, with terms ranging from 10-30 years. Some conforming mortgages come with features like low initial monthly payments, free 60-day rate lock, and a discounted rate for using a network real estate agent.

  • Jumbo mortgage

    Like a regular mortgage, but for loan amounts of between $484,350 to $2 million.

  • VA loan

    Government-backed loan for former and retired servicepeople and spouses who meet certain conditions. Comes with fixed rate and includes option of zero down payment.

  • Home Equity Loan (HEL)

    Lets homeowners borrow against their home equity with one-off lump sum.

  • Home Equity Line of Credit (HELOC)

    Lets homeowner withdraw money against their home equity, up to a pre-approved limit.

The Application Process

Like other credit unions, PenFed only offers products to its members. In PenFed’s case, membership is restricted to the following people:

  • Active and formed Armed Forces personnel
  • US Government employees
  • Employees and members of qualifying organizations with links to the defense industry

Any PenFed member can apply for a mortgage online or over the phone, provided they meet the following conditions:

  • US citizen or legal residents.
  • Aged 18 years or more.
  • Opening and maintaining a PenFed savings or share account with at least $5 balance at all times.
  • Credit score of 620+

Pros and Cons

With PenFed, borrowers get to choose from a wide range of loan options and features. PenFed offers 22 different types of mortgages based on different combinations of loan type (e.g. conforming, jumbo, VA) and loan terms. It offers a ton of features, 2 of which we’d like to single out. With the free 60-day rate lock, borrowers can lock in a rate on certain mortgages without having to commit for 2 months. With the PenFed Real Estate Rewards program, borrowers save 0.5% of their loan amount up to $20,000 for using a network real estate agent and preferred title provider to purchase their new home.

The one real downside to PenFed’s service is the lack of FHA loans. FHA loans are a type of government-backed mortgage that offer borrowers with sub-620 credit an opportunity to get into the housing market. If you get rejected by PenFed because of poor credit, you may find yourself having to turn to another lender for a mortgage.

Rates and Fees—The Bare Basics

One of the great things about PenFed is the transparency. Borrowers can see rates and APRs for all products by clicking the Compare Rates button on PenFed’s home page.

Repayment Terms

Each loan type comes with its own set of repayment terms:

  • Fixed-rate conforming loans carry options of 10-, 15-, 20-, or 30-year terms.
  • Fixed-rate VA loans carry 15-year or 30-year terms.
  • Fixed-rate jumbo mortgages have 15-year or 30-year terms.
  • Adjustable-rate mortgages (ARMs) come with the following options: 15/15, 10/1, 7/1, 5/5, 5/1, 3/1.

Help & Support

Most credit unions treat their customers well, and PenFed appears to be no different in this regard. It offers support via phone, email, live chat, and even fax.

Phone: 800-247-5626


How This Company Compares

PenFedJ.G. WentworthQuicken Loans
Min. Credit Score620500500
Min. Down Payment0%0%3.5%
Terms10-30 years15-30 years15-30 years
Suitable ForVA loans and low down paymentsChoices and convenienceStreamlined online application

As a credit union, PenFed is more exclusive than large mortgage lenders. This has its pros and cons. On the downside, PenFed offers fewer options for borrowers with poor credit. On the upside, eligible borrowers can find great deals with PenFed, including lower APRs, lower down payments, and lower monthly payments than those offered by PenFed’s competitors.


PenFed is a good all-around option for anybody who qualifies as an eligible borrower. PenFed doesn’t serve all people and it doesn’t offer all types of mortgage products. However, it takes extra good care of the millions of Americans who are eligible for its mortgages, with perks like discounted APRs, low down payments, and low introductory monthly payments. If you belong to any of the 170 qualifying organizations and are currently searching for a house, we recommend checking out PenFed.

PenFed F.A.Q.

Q: What does PenFed membership involve?

A: To join PenFed, simply open a savings or share account and maintain at least a $5 balance at all times. This entitles you to apply for any PenFed financial product.

Q: Does PenFed offer services other than mortgages?

A: Yes. PenFed offers other banking services, including checking and savings accounts, credit cards, and personal loans.

Q: Where is PenFed based?

A: PenFed accepts online applications. It also has branches in the District of Columbia, Maryland, Virginia, California, Florida, Georgia, Hawaii, Nebraska, New Mexico, New York, North Carolina, Texas, and at military bases in Guam, Japan, Portugal, and Puerto Rico.

Q: Is PenFed insured?

A: As a credit union, PenFed is federally insured by the National Credit Union Administration.

Physical Address

Pentagon Federal Credit Union

7940 Jones Branch Dr, Tysons

VA 22102

PenFed-QS PenFed-QS Visit PenFed

PenFed customer testimonials

AverageReviews 12
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  • author
    Oct 26, 2020
    Not Perfect but None Better

    I have used Penfed for over 25 years. I have had some great experiences and some not so great ones. Customer Service is like a roller coaster. Sometimes it is great, sometimes it is terrible but 7/10 times it is good. I have had issues with wire transfers (35k was "missing") and although it took two months it did get resolved but I never got an explanation. The best thing IMO about them is the interest rates on many of their products are the best I have found. HELOC and vehicle loan rates are about as low as anything you will find out there. Comparatively speaking they are a pretty good Credit Union and I will continue to use them until I find a better one. I have tried four other credit unions (Navy, Airforce, Eglin, Ft Bragg) and no other Federal Credit Union can touch the rates they have given me.


  • author
    Sep 15, 2020
    Pentagon FCU is supposed to be great…

    Update - 15 SEP 2020, I stand by what I wrote in my review. I sent the Post to PenFed as requested. I can prove everything. Original Post - Pentagon FCU is supposed to be great for VA Home Loans. I called and applied with a loan officer and explained that I tried with USAA and was preapproved but was told more money was needed. The PenFCU loan officer said she would contact the VA to see what was needed before they could issue a preapproval letter but $19,500 for the final approval due to an old car in a divorce and more savings req. Long story short I came up with $12,058 and asked if that would suffice as the car was paid-off etc. No word ever from PenFCU. I called, emailed, sent letters etc. No word ever. Everytime you call the regular number they say only the loan officer can assist. I call her and receive no response. - No professionalism.


  • author
    robert morris
    Sep 08, 2020
    I recently opened a PenFed account and…

    I recently opened a PenFed account and received a credit card. I tried to make a payment by calling in, and it was an impossible task. After waiting for a customer service agent for over 30 minutes, I finally gave up. There simply is zero customer service.


  • author
    J Michael Tygart
    Sep 02, 2020
    BEWARE of PENFED Credit Union

    PENFED Credit Union is undoubtedly the worst financial institution in America. Thoroughly incompetent at every level, dishonest and unethical. Customer service is non-existent with belligerent, argumentative and incompetent employees. Don't be victimized by this company posing as a military compatible organization. Take it from the Chief - Beware of PENFED.....


  • author
    Pedro Jimenez
    Sep 01, 2020
    Finally able to access account online..

    Finally able to access account online... Started with savings account, and will monitor and update progress working with this credit union... Scrutiny and documentation to open online savings account was tough, I'll try only savings and checking products for now...