When we saw that Costco got rid of another member perk, we assumed it had something to do with the brand's COVID-19 policies. After all, Costco just did away with its special pandemic hours. However, this time around, the company has one of its beloved member benefits on the chopping block: the Costco mortgage program.
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According to Eat This, Not That!, Costco will no longer be facilitating its mortgage program, which offered members a cap on lender fees — $250 for executive members and $550 for others — with the following companies:
- Box Home Loans
- Strong Home Mortgage
- CrossCountry Mortgage
- Mutual of Omaha Mortgage
- NBKC Bank
- Real Genius
According to Rocket Mortgage, mortgage origination fees (what a lender charges for processing a loan) are generally between 0.5% and 1% of the total loan amount. CNBC reports that the average loan size is $453,000. This means that a homebuyer with an average-size loan could pay an origination fee up to $4,530, instead of the Costco price of $250 or $550.
Sadly, Costco has not offered a reason for the demise of this perk (though, it's likely due to the rise in interest rates and decline in people taking on mortgages). On its Mortgage Services page, the brand stated that the mortgage program would no longer be available through Costco as of May 1, 2022. "Members with questions regarding their current mortgage application and loan should contact the lender they have been working with," Costco states. You can see a list of the lenders and their phone numbers on that same page.
Fortunately, Walmart recently announced that it now has its very own mortgage program, per Eat This, Not That!. Inside three of its stores — and more coming soon — the chain will now have a retail space for Lenders One Cooperative's mortgage services and products.
So while we're sad to see Costco's mortgage perk go, we're glad another store is offering a similar benefit.