Select rounded up five of the best mortgage lenders to help you streamline your search.
The home-buying process is notoriously stressful and oftentimes confusing, especially if you’re taking on a mortgage to finance most of your purchase. There’s a lot to learn when it comes to the mortgage application process, so Select rounded up a list of five of the best mortgage lenders to help you streamline the process and find a lender that best suits your needs.
We evaluated lenders based on the types of loans offered, customer support and minimum down payment amount, among others (see our methodology below.)
However, it’s important to keep a few things in mind when you’re looking to apply for a mortgage. First off, mortgage interest rates can fluctuate quite often, however, the rate you are likely to receive will heavily depend on your location, credit score and credit report. While you can take a look at each lender’s website to get an idea of what interest rates they charge, the best way to get a solid idea of what you will be charged is to provide the necessary information to check your rate.
The mortgage approval and acceptance process come with many fees, collectively called “lender fees.” This can include an origination fee, processing fee, application fee and an underwriting fee. In addition to lender fees, you may also pay a document preparation fee, an appraisal fee, title search fee, title insurance and more. According to ValuePenguin, lender fees can run you an average of an additional $1,387.
Some lenders may waive certain fees or provide discounts on fees. It’s always a good idea to ask which fees have the potential to be waived but when you decide to move forward with a particular loan from a lender, prepare yourself to account for these additional charges.
Lastly, it’s important to do your homework so you can be sure you’re choosing the lender that can suit your needs whether you’re a first-time homebuyer or purchasing an investment property. We have included an FAQ section below to help you familiarize yourself with some aspects of the process, but if you have other more specific questions, reach out to a representative or an advisor at your desired lender.
The best mortgage lenders
Best for lower credit scores: Rocket Mortgage
Best for flexible down payment options: Chase Bank
Best for no fees: Ally Bank
Best for flexible loan options: PNC Bank
Best for saving money: SoFi
Who’s this for? Rocket Mortgage is one of the biggest U.S. mortgage lenders and has become a household name. Most mortgage lenders look for a minimum credit score of 620 but Rocket Mortgage accepts applicants with lower credit scores at 580.
The lender even has a program called the Fresh Start program that’s aimed at helping potential applicants boost their credit score before applying. Keep in mind, though, that if you apply for a mortgage with a lower credit score, you may be subject to interest rates on the higher end of the lender’s APR range.
This lender offers conventional loans, FHA loans, VA loans and jumbo loans but not USDA loans, which means this lender may not be the most appealing for potential homebuyers who want to make a purchase with a 0% down payment. Rocket Mortgage doesn’t offer construction loans (if you want to build a brand new custom home) or HELOCs, but if you’re a homebuyer who only plans to purchase a single-family home, a second home, or a condo that’s already on the market, this shouldn’t be a drawback for you.
This lender offers flexible loan repayment terms that range from 8 – 29 years in addition to standard 15-year and 30-year terms.
On average, it takes about 47 days to close on a home through Rocket Mortgage. However, keep in mind that, in general, much of the closing timeline will depend on how quickly you can provide all the information and documentation that’s needed and whether or not they can be processed without a major hitch.
Best for flexible down payment options
Who’s this for? Chase Bank provides several options for homebuyers who would prefer to make a lower down payment on their home. The traditional advice has been to make a down payment that’s about 20% of the price of the home, however, Chase offers a loan option called the DreaMaker loan that would allow homebuyers to make a down payment that’s as low as 3% (by comparison, the FHA loan requires borrowers to make a 3.5% down payment).
This option is made for those who can only afford a smaller down payment, but it also comes with stricter income requirements compared to their other loans (the annual income used to qualify the customer must not exceed 80% of the Area Median Income (AMI), according to the Chase team). If you meet the income requirements for the DreaMaker loan, this option could be very attractive for those who would prefer to make a down payment that’s as small as possible so they can have more money reserved for other homebuying expenses.