Best Mortgage Lenders of October 2026

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Reviewed by 
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Last updated August 10, 2026
NerdWallet’s editorial team picked the best lenders across categories to help you find the home loan that's right for you. Taking the time to make an informed decision can save you thousands over the life of your loan.
 

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Who is the best mortgage lender?

It depends on your unique needs. For example, if you're new to the market, NerdWallet's winner for first-time home buyers (Rocket) may be worth a look. But, if you're a military member or veteran, you might want to check out NerdWallet's winner for VA loans (Navy Federal). In short: The best mortgage lender is the one that offers the products you need, has requirements you can meet and charges the lowest mortgage rates and fees.

Our 2026 Best-Of Award Winner

NerdWallet Best-Of Awards Badge
Best Mortgage Lender  Overall

Truist

NMLS#399803

Truist
Truist

Truist

NMLS#399803

Home loans overall
Overall
Overall
WHY OUR NERDS LOVE IT
Truist jumps to the front of the pack for offering consistently low rates and fees, particularly compared to its large-bank peers. An impressive array of loan types helps the lender serve a wide range of financial needs and budgets, while its quick and easy application experience and faster-than-average time to close boost its convenience.
Sort by:

Best for home loans overall

Chase

NMLS#399798

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

Our take on Chase

The Nerdy headline

Chase mortgage has an above-average reputation for consumer satisfaction, and offers a number of programs that can make home buying more affordable and accessible.

What we like
  • Offers a wide range of loan types, including options with low down payment requirements.
  • Home buyer grants up to $5,000 may apply for qualified borrowers.
  • Receives above-average ratings for customer satisfaction, according to J.D. Power and Zillow.
What we don't like
  • Borrowers must create an account or speak with a home loan expert before completing an online application.
  • Parts of the prequal and preapproval process cannot be done solely online.

Best for Jumbo loans, cash-out refinancing and second home loans

Bank of America

NMLS#399802

NerdWallet rating

5.0

Jumbo loans
Min. credit score

720

Min. down payment

5%

Our take on Bank of America

The Nerdy headline

Bank of America offers low average jumbo rates and fees. Some borrowers can qualify for down payment assistance or rate discounts.

What we like
  • Offers low average jumbo rates and fees compared with other lenders.
  • Major jumbo lender, by loan volume.
What we don't like
  • Jumbo loans represent a somewhat small share of total home lending for Bank of America.
  • Online rate quote tool doesn’t personalize by credit score.

Best for VA loans

Veterans United

NMLS#1907

Min. credit score

620

Min. down payment

0%

Our take on Veterans United

The Nerdy headline

Veterans United originates more VA mortgages than any other lender. Though average VA APRs are middle of the road, it’s a solid pick for veterans and military borrowers looking for a lender that has ample experience with this loan type.

What we like
  • Major VA lender, by loan volume.
  • VA loans make up a large share of Veterans United's total home loans.
  • Offers a strong variety of VA loan types for purchase and refinance.
What we don't like
  • Average VA loan APRs are less competitive than some other top VA lenders, according to the latest data.
  • Website doesn’t have online chat.

Best for Home loans overall, jumbo loans and cash-out refinancing

Wells Fargo

NMLS#399801

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

Our take on Wells Fargo

The Nerdy headline

Wells Fargo has significantly shrunk its mortgage business in recent years, but still offers a range of government-backed and speciality loans, as well as assistance for first-time home buyers.

What we like
  • Borrowers can see customized mortgage rate estimates online.
  • Offers relatively low interest rates and fees, according to the latest federal data.
  • Discounts may be available for existing Wells Fargo customers.
What we don't like
  • Does not offer home equity loans or HELOCs.
  • Borrowers need at least $250,000 in assets with the bank to qualify for a rate discount.
  • Prospective borrowers may be put off by the lender’s past legal issues.

Best for home equity loans

Better

NMLS#330511

NerdWallet rating

5.0

Home equity loans
Min. credit score

640

Min. down payment

N/A

Our take on Better

The Nerdy headline

Online lender Better’s home equity loans offer flexible terms and personalized rate tools, but application or support options are somewhat limited.

What we like
  • Flexible term options.
  • Borrowers can personalize home equity loan rates online, by location.
What we don't like
  • Charges closing costs.
  • No mobile app.

Best for FHA loans

loanDepot

NMLS#174457

NerdWallet rating

5.0

FHA loans
Min. credit score

520

Min. down payment

3.5%

Our take on loanDepot

The Nerdy headline

LoanDepot, one of the country’s largest mortgage lenders, offers a wide range of FHA mortgages, including the harder-to-find FHA 203(k) renovation loan.

What we like
  • FHA loans make up a large share of LoanDepot's total home loans.
  • Major FHA lender, by loan volume.
  • Offers a strong variety of FHA loan types for purchase and refinance.
What we don't like
  • No mortgage rates posted online.
  • Recent headlines have damaged consumer trust.
NerdWallet Best-Of Awards Badge

Best for first-time home buyers

2026 NerdWallet award winner

Rocket Mortgage, LLC

NMLS#3030

NerdWallet rating

4.5

Home loans overall
Min. credit score

620

Min. down payment

3%

Our take on Rocket Mortgage, LLC

The Nerdy headline

Rocket Mortgage is the Goliath of home loans in the U.S. It's the largest mortgage lender by volume, and keeps expanding its reach. Fortunately for borrowers, Rocket is a gentle giant, offering affordable borrowing options including a 1% down payment loan.

What we like
  • Offers down payment and closing cost assistance.
  • Largest lender, by volume, of FHA loans in 2025.
  • Borrowers can apply via mobile app.
What we don't like
  • Average origination fees are on the higher side, according to the latest federal data.
  • No HELOCs.
  • No physical branches.

Best for VA loans

Navy Federal

NMLS#399807

Min. credit score

Not disclosed

Min. down payment

0%

Our take on Navy Federal

The Nerdy headline

Navy Federal is known for VA lending, but its flexible VA-like loan options truly stand out. You'll need a military connection to join the credit union.

What we like
  • Low average APRs compared to other lenders.
  • Major VA lender, by loan volume.
What we don't like
  • Borrowers must join the credit union before applying for a mortgage, and all borrowers on the loan must be members for the loan to close.
  • Does not offer VA rehab and renovation loans.

Best for Home loans overall, refinancing, HELOCs, manufactured and second home loans

Truist

NMLS#399803

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

Our take on Truist

The Nerdy headline

If you want a wide range of loan options from a traditional bank, Truist is worth a look. Its streamlined application process and access to human support can make borrowing easier.

What we like
  • Offers a wide range of mortgage options focused on affordability.
  • Convenient online application.
  • Generous grants for qualifying home buyers in select locations.
What we don't like
  • Getting custom rates and applying for mortgage preapproval both require human contact.
  • Customer care leans heavily on phone and in-person service.
  • HELOCs are not available in most states, though home loans are available everywhere in the U.S. except Alaska, Arizona and Hawaii.

Best for FHA loans

Pennymac

NMLS#35953

NerdWallet rating

5.0

FHA loans
Min. credit score

580

Min. down payment

3.5%

Our take on Pennymac

The Nerdy headline

Pennymac, known for government loans, has low average FHA rates. Best for FHA borrowers looking for low rates and an efficient digital experience.

What we like
  • FHA loans make up a large share of Pennymac's total home loans.
  • Major FHA lender, by loan volume.
  • Offers low FHA mortgage rates compared with other lenders.
What we don't like
  • You can't shop rates without giving the lender your contact information first.
  • No construction or renovation loans.

Best for Low credit borrowers and home loans overall

PNC Bank

NMLS#446303

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

Our take on PNC Bank

The Nerdy headline

PNC Bank offers a wide selection of loans and refinance options, with a streamlined digital experience and comprehensive rates tool.

What we like
  • Solid variety of mortgage types, both standard and harder-to-find.
  • Online rate quotes are informative and easy to customize.
  • Offers down payment grants and no-PMI loans for low-income borrowers.
What we don't like
  • Mobile app has limited mortgage features.
  • In-person service not available in all states.
  • Construction loans are only available in AL, AZ, CA, CO, FL, GA, NJ, NM, NC, OH, PA, SC, TN, TX, VA and WA.

Best for home equity loans

SoFi

NMLS#696891

NerdWallet rating

5.0

Home equity loans
Min. credit score

680

Min. down payment

N/A

Our take on SoFi

The Nerdy headline

SoFi’s home equity loans offer flexible term options and faster-than-average closing, but may require an appraisal and aren't available for second homes.

What we like
  • Flexible term options.
  • Average reported closing time is two weeks.
What we don't like
  • May require an appraisal.
  • Not available for second homes.

Best for manufactured home loans

U.S. Bank

NMLS#402761

NerdWallet rating

4.5

Home loans overall
Min. credit score

620

Min. down payment

3%

Our take on U.S. Bank

The Nerdy headline

U.S. Bank offers a broad selection of mortgages, including some niche options. Rates and fees are middle of the road, per federal data. The bank offers helpful tech for rate shopping and live chat, though its online application could be smoother.

What we like
  • Wide variety of mortgages, including some harder-to-find types.
  • Experience in construction and renovation loans.
  • Offers up to $17,500 in assistance (income/location requirements apply).
What we don't like
  • Rates shown online don’t reflect your credit score.
  • Contact form interrupts online application before you can complete it.
  • Few mortgage options for borrowers with low/bad credit.

Best for Refinancing, first-time home buyers and home loans overall

Alliant

NMLS#197185

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

Our take on Alliant

The Nerdy headline

Alliant Credit Union allows you to see a wide range of customized mortgage rates without sharing your contact information, and offers competitive loan products for first-time home buyers.

What we like
  • Offers a competitive combination of low rates and fees.
  • Mortgage borrowers do not need to become members of the credit union until reaching the closing process.
  • Sample rates are displayed upfront, and it's easy to get detailed, personalized rates without providing any personally identifying information.
What we don't like
  • No mobile app available.
  • Doesn't offer energy-efficient mortgage refinances.

Best for home loans overall

FourLeaf Federal Credit Union

NMLS#449104

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

Our take on FourLeaf Federal Credit Union

The Nerdy headline

FourLeaf Credit Union, formerly known as Bethpage, is easy to join: Just deposit $5 in a savings account. Its online rates tool lets you estimate monthly payments, but customization is limited.

What we like
  • Nice selection of specialty mortgages.
  • Well rated mobile app.
What we don't like
  • No renovation or construction loans.
  • Online rate quote is light on detail and doesn’t let you customize.

Best for Home loans overall and borrowers with low credit

First Federal Bank

NMLS#408902

NerdWallet rating

5.0

Home loans overall
Min. credit score

620

Min. down payment

3%

Our take on First Federal Bank

The Nerdy headline

First Federal Bank stands out for its competitive APRs and its emphasis on government loans. Most likely to appeal to borrowers shopping for low rates and fees.

What we like
  • Strong experience in FHA and VA lending.
  • APRs tend to be competitive, according to the latest federal data.
  • Minimum credit score requirement of 580 for some loans, which is lower than some competitors.
What we don't like
  • Home equity lending is not a priority.
  • Customizable rates are not available online without providing contact information.

Best for HELOCs

Regions Bank

NMLS#174490

Min. credit score

Not disclosed

Min. down payment

N/A

Our take on Regions Bank

The Nerdy headline

Regions Bank HELOCs come with a low introductory rate lower for the first six months and can be used for either a first or second home. Borrowers can take advantage of discounts if they sign up for autopay or already have an eligible Regions checking account. Regions will also cover closing costs on credit lines of $500,000 or less.

What we like
  • Can convert $5,000 up to your full outstanding balance to a fixed rate.
  • Offers introductory rate for first six months after as well as autopay and existing customer rate discounts.
  • Closing costs covered by Regions for credit lines up to $500,000.
What we don't like
  • Maximum combined loan-to-value (CLTV) ratio is only 80%.
  • Closing can take longer compared to some lenders.
  • Charges over limit fees, late fees and a fee to convert your balance to a fixed rate.

How we chose the best home loan lenders

Our team of mortgage experts follows an objective, consumer-first methodology to assess home loan lenders and pick the best.

40+

Lenders reviewed

We review more than 40 lenders, including major banks, credit unions, and online lenders operating across multiple states.

100+

Categories assessed

Each lender is evaluated across more than 100 weighted categories covering rates and fees, types of home loans offered, rate transparency and customer experience.

11,000+11k+

Data points analyzed

Our team tracks and reassesses thousands of data points annually for reviewed lenders, ensuring up-to-date, accurate comparisons across multiple loan types.

Methodology

NerdWallet rates mortgage lenders based on what matters most to borrowers: rates and fees, product accessibility, customer experience, rate transparency and the range of loan options.
We review more than 40 lenders and score them using a weighted system that prioritizes affordability and a smooth borrowing experience. Lenders earn higher scores for offering lower borrowing costs, making loans widely available, clearly displaying rate information and supporting borrowers from application through closing.
We use a mix of lender-provided information, publicly available data and our own research and analysis to evaluate each lender. Recent regulatory actions may affect a lender’s score.
NerdWallet's editorial team selected the mortgage lenders that appear on this page from our lists of best mortgage lenders for: first-time home buyers, borrowers with low credit, FHA loans, VA loans, home equity lines of credit (HELOCs), home equity loans, cashout refinancing, second home loans, manufactured home loans, refinancing and home loans overall. In each category, the highest-scoring lenders were selected. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.

A guide to the best mortgage lenders, from the Nerds who chose them

Each lender that makes our monthly list gets high marks for its general offerings, or a niche loan type, like VA, FHA or HELOCs. Here’s what makes the best mortgage lenders on this month's list stand out.

Chase: "We were swept off our feet by their speedy time to close"

We were swept off our feet by Chase’s speedy 21-day average time to close — roughly half the reported average. Its comprehensive rates calculator helps by giving you a simple loan comparison before applying. In my analysis, I also found Chase offers products to a wider-than-average range of financial situations, has lower-than-average APRs and offers a closing cost grant for qualifying first-time home buyers. As far as the “womp-womps” go, you won’t find home equity loans on offer here, and prequal and preapproval aren’t available online.
Biggest reason I put them on this Best Of list: Scores highly for home loans overall

Bank of America: "They boast a range of classic and less common mortgage products"

Bank of America boasts a range of classic and less common mortgage products, giving options to borrowers who might need to explore loan types and find the best fit. Jumbo loans, cashout refinancing, interest-only loans and second home loans are just a few of the products on offer. Need more? Self-employed borrowers and physicians can also find tailored options for their unique situations. But with choice comes compromise — Bank of America's APRs are much less competitive than some of our other lenders, and we couldn’t find evidence of a low-credit assistance program.
Biggest reason I put them on this Best Of list: Scores highly for jumbo loans, cash out refinances and second home loans

Veterans United: "They're a behemoth VA lender — the largest in the U.S. by far"

Veteran’s United is a behemoth VA lender — the largest in the U.S. by far — and it offers a range of products, from classic VA loans to energy-efficient mortgages and streamline refinances. Borrowers on the go may appreciate the full-service mortgage mobile app and 24/7 phone customer service, which might be especially helpful if you’re stationed overseas. But you can only contact Veterans United via phone or in person — something to keep in mind if you prefer online customer service options.
Biggest reason I put them on this Best Of list: Scores highly for VA loans

Wells Fargo: "What we like to call an all-rounder"

Wells Fargo is what we like to call an all-rounder — it keeps your budget top of mind (with lower-than-average APRs and down payment assistance and first-time buyer programs), opens the door to a range of financial situations (offering niche products like ITIN loans and mortgages for new construction), and maintains a decent level of transparency (its nifty online rates tool lets you preview monthly payments before you apply). But even the all-rounders have their flaws: Wells Fargo has a rather sluggish average time to close of 38 days. And while the mobile app and website support some application steps, it’s not fully online from start to finish.
Biggest reason I put them on this Best Of list: Scores highly for home loans overall

Better: "A lender that offers choice when it comes to home equity"

Borrowers who haven’t built up a ton of equity in their home may appreciate Better’s 90% combined loan-to-value maximum for its home equity loans — giving you a higher ceiling to borrow from. Plus, we like a lender that offers customer choice: Better has a solid range of term lengths (from 10, 15, 20 or 30 years), and the ability to take out a loan on a second home or investment property. If speed is of the essence, you’ll love its 21-day average time to close. Still, a few dings on their report card include the absence of a mortgage mobile app and a minimum credit score (680) that’s higher than some other lenders.
Biggest reason I put them on this Best Of list: Scores highly for home equity loans

LoanDepot: "True to its name, LoanDepot has a warehouse of products"

True to its name, LoanDepot has a warehouse of products, particularly FHA offerings — low-credit borrowers can choose from 203(b), 203(k), energy-efficient, rate-and-term, streamline refinance and even HECM mortgages (a rare FHA product for seniors). I especially appreciate that LoanDepot caters to a wider-than-average range of financial situations, offers lower-than-average APRs and dedicates a good portion of its business to FHA loans. However, comparison shopping would be easier if LoanDepot displayed sample rates on their website. Be prepared to call or fill out an online form to get a quote.
Biggest reason I put them on this Best Of list: Scores highly for FHA loans

Rocket: "First-time homebuyers with lower incomes listen up"

First-time homebuyers with lower incomes and minimal savings listen up: You can put as little as 1% down using Rocket’s ONE+ program, which is designed for borrowers in select locations who earn less than 80% of the area median income. As one of the original digital-first mortgage lenders, it’s no surprise we’re also impressed by Rocket’s user-friendly setup — applications can be completed via the mobile app or online, there’s a decent rate comparison tool, and the average time to closing is a quick 28 days. But if you’re looking for rarer loan types, like USDA, ITIN, nonwarrantable condo or construction mortgages, we’ll save you some time — Rocket doesn’t have them.
Biggest reason I put them on this Best Of list: Scores highly for loans for first-time homebuyers
Experience is crucial when it comes to VA loans, and Navy Federal has it in spades. It’s one of the biggest players in the VA lending market and offers lower-than-average APRs. I especially appreciate the comprehensive rate calculator on their website, which we value greatly for helping borrowers compare quotes and save money. However, you won’t find more specialized VA loan types here, like renovation or energy-efficient mortgages.
Biggest reason I put them on this Best Of list: Scores highly for VA loans

Truist: "Our 2026 best mortgage lender award winner"

Truist is our 2026 award winner for Best Mortgage lender, so it’s no surprise it made this list. Not only does it offer the classics (conventional, Jumbo, FHA, VA and home equity products), it also dishes up rarer varieties like construction-to-permanent and manufactured home loans. Alongside this smorgasbord of loans, we were doubly impressed by the lower-than-average APRs, down-payment assistance programs, and sample online rates so you can see what you're getting into before you apply. However, tech-savvy users may wish for mortgage features on the mobile app and more ways to get in touch — that the only way to reach Truist is via phone or in-person.
Biggest reason I put them on this Best Of list: Scores highly for home loans overall

Pennymac: "Low-credit borrowers will get the most out of this lender's offerings"

Low-credit borrowers looking for competitive rates will get the most out of Pennymac’s FHA offerings — average APRs are lower than other FHA lenders we reviewed, and borrowers with credit scores as low as 580 will be considered (though with stronger credit comes better rates). Pennymac also dedicates a sizable part of its business to this loan type (implying expertise) and offers products to a range of financial situations. If you want an easy-breezy, tech-friendly experience, however, you may be disappointed. The comprehensive rate comparison tool on the website is hidden behind a contact form, and the only way to contact Pennymac is by phone.
Biggest reason I put them on this Best Of list: Scores highly for FHA loans

PNC: "If you enjoy getting lost in the details, you’ll like the rates comparison tool"

If you enjoy getting lost in the details, you’ll like PNC’s free rates comparison tool, which lets you see potential monthly costs based on your location and credit score for a range of loan types. I also enjoy getting lost in the details, especially when I find consumer-friendly perks — while exploring PNC's offerings, I was pleased to find specialized grants for low-income borrowers and lower-than-average APRs. However, I found that PNC’s mobile app doesn’t support a full application process (something tech-savvy borrowers may not appreciate).
Biggest reason I put them on this Best Of list: Scores highly for home loans overall

SoFi: "If you need to pull equity from your home fast, you'll like their speedy closing"

If you need to pull equity from your home fast, you’ll appreciate SoFi’s 14-day average closing time — and you won’t be sacrificing on quality. As one of the big players for home equity loans, we were impressed by SoFi’s competitive APRs, flexible term lengths (from five to 30 years), and broad reach across borrower financial profiles. But it’s not all sunshine and rainbows. SoFi’s home equity loan comes with closing costs, and you can’t redraw the loan.
Biggest reason I put them on this Best Of list: Scores highly for home equity loans

U.S. Bank: "Competitive rates for manufactured home buyers"

Manufactured home buyers will be pleased to know that U.S. Bank not only offers loans for this type of dwelling, but has lower-than-average APRs and serves a broad range of financial situations. You can also take advantage of the bank’s American Dream Mortgage program, which can provide down payment assistance, closing cost grants and even cover mortgage insurance. U.S. Bank’s full-service mobile app and online application process make for a nice bonus. Still, keep in mind that manufactured loans don’t make up a large portion of U.S. Bank’s business.
Biggest reason I put them on this Best Of list: Scores highly for manufactured home loans

Alliant: "What caught my eye the most were the super-competitive APRs"

If you’re the planner in the friend group, you’ll appreciate Alliant’s detailed rates and payment calculator, which can help you compare your options more accurately before you apply. What caught my eye the most, though, were Alliant’s super-competitive APRs, speedy closing times and access to a first-time homebuyer program with 0% down and no PMI. Note that mobile app users will be left empty-handed — we couldn’t confirm that mortgage features are available.
Biggest reason I put them on this Best Of list: Scores highly for home loans overall

FourLeaf: "Internet-savvy borrowers may appreciate the fully online application process"

Internet-savvy borrowers may appreciate Fourleaf’s fully online application process that takes you from prequal to document uploads (but don’t expect the same options on the mobile app). Fourleaf stood out from the pack for a combination of lower-than-average APRs and relatively fast average closing to save you both time and money. Plus, Fourleaf participates in assistance programs for first-time home buyers. However, detail-oriented borrowers may find the online rate comparison tool lacking — the sample rates are helpful, but you can’t customize them based on your location or credit score, which makes it just a tad harder to comparison shop.
Biggest reason I put them on this Best Of list: Scores highly for home loans overall

First Federal: "Offers less common loans for unique employment and property types"

Looking for less common loans for unique employment and property types? First Federal may just have it — you’ll find USDA, second home loans, construction and bank statement loans offered. Equally impressive is the comprehensive mortgage mobile app and fully online application process… and lower-than-average APRs don’t hurt. If tapping into your home equity is the plan, you’ll want to look elsewhere, though — the lender tells us that HELOC and home equity loans aren’t their current priority.
Biggest reason I put them on this Best Of list: Scores highly for home loans overall

Regions Bank: "Offers a rate discount for automatic payments on HELOCs"

If you’re a set-it-and-forget it kind of HELOC borrower, you’ll like Regions’ rate discount for automatic payments. Plus, there are plenty of other ways to save: You can get a discounted introductory rate for six months, no origination fee and no annual fee. When I looked across the latest data, Regions’ HELOC rates were especially competitive. But if a speedy closing time is high on your list, Regions 30-day average may be too sluggish.
Biggest reason I put them on this Best Of list: Scores highly for HELOCs

🏆 Truist is NerdWallet's Overall Best Mortgage Lender of 2026

Truist was NerdWallet's pick for the overall best mortgage lender in 2026. Truist also won best lender for refinancing, home equity lines of credit and second home loans. Here's more about how we made our decisions and why Truist came out on top.
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How does a mortgage work?

A mortgage is a loan to buy a house. You repay it monthly — with interest — over a number of years (often 15, 20 or 30). If you fail to make payments on time, the lender may take the home through a process known as foreclosure.
  • Who offers mortgages? Banks, credit unions and third-party lenders.
  • How do you apply? Depending on the lender, you may be able to fill out an application online, through a mobile app or in person. 
  • What do lenders check? Your income, existing debts and credit score typically determine your eligibility, as well as the terms offered.

Types of mortgages

There are many types of mortgages available on the market. Here is a simple breakdown of your options.

Conventional loans

Conventional loans are the most common type of mortgages. While they are not backed by the federal government — like FHA and VA loans — they still typically adhere to the Federal Housing Finance Agency (FHFA) guidelines. Some require as little as 3% down, but private mortgage insurance (PMI) is needed if the down payment is under 20%.
There are two types of conventional loans:
  • 🏠 Conforming loans

    Conforming loans must stay within loan limits set by the FHFA. They follow rules from Fannie Mae and Freddie Mac, which buy these loans.
  • 🏠 Nonconforming loans

    Nonconforming loans  — like non-QM loans — do not follow these limits or guidelines, such as Jumbo loans, which typically exceed FHFA loan limits. They often require higher credit scores and stricter approval criteria.

Government-backed mortgages

These loans are insured by the federal government. The three main types of government-backed home loans are:
  • 🏠 FHA Loans

    FHA loans are backed by the Federal Housing Administration, and typically have more lenient requirements.
    • 3.5% down payment required
    • Lower credit score requirement than other loans 
    • Mortgage insurance required 
  • 🏠 USDA loans

    USDA loans are backed by the U.S. Department of Agriculture, and typically suited to rural home buyers.
    • No down payment required
    • Upfront and annual guarantee fees apply (similar to mortgage insurance)
  • 🏠 VA loans

    VA loans are backed by the Department of Veterans Affairs.
    • For veterans and active military 
    • No down payment required 
    • One-time VA funding fee (can be added to the loan)

Types of mortgage terms

How your mortgage is structured informs the length and overall cost of your loan.

Fixed vs. adjustable rate

  • Fixed-rate mortgage: The interest rate stays the same for the entire loan.
  • Adjustable-rate mortgage (ARM): The interest rate stays the same for a certain period (up to 10 years), then adjusts at specific intervals (usually every six months).

15-, 20- and 30-year mortgages

  • 30-year mortgages are the most common.
  • 15- and 20-year loans are also available.
  • Payments are spread over the loan term. 
  • Once fully paid, you own the home free and clear.

What’s the credit score needed for a home loan?

The credit score needed to buy a home depends on the type of loan and the lender. Lenders typically require a credit score of at least 620 for conventional loans but can go as low as 500, according to data collected by NerdWallet.
FHA loans generally have the most lenient credit score requirements, with most lenders NerdWallet reviews stating a minimum score of 580 or lower.

How to compare mortgage rates

  1. Check current mortgage rates to see the average offers. 
  2. Get online quotes from lenders based on personal factors, such as: 
    • Your location
    • Loan term
    • Purchase price
    • Down payment
  3. To get a more personalized quote, apply for preapproval. During preapproval, the lender will check your credit score and verify your financial information, such as income, assets and debts.

How to shop for a mortgage lender

The best time to shop for a mortgage lender is before you start house hunting.
  • Get preapproved: This shows real estate agents and sellers that you’re a serious buyer.
  • Compare loan estimates: Request estimates from multiple lenders.
  • Review key details: Look at loan terms, monthly payments and estimated closing costs.
By comparing lenders, you can find the best deal and save money over time.

Home equity loans and lines of credit

Home equity loans and lines of credit allow homeowners to access their home equity without refinancing or selling.
Important: Both options use your home as collateral. If you miss payments, you could lose your home.

Refinancing a mortgage

Getting a mortgage doesn't have to be a one-time decision. Refinancing lets you replace your current home loan with a new one — to lower your interest rate, change your loan term or access home equity, for example. The new loan pays off the old one, and you make payments on the refinance instead.

Why homeowners refinance

  • Lower the interest rate to reduce monthly payments
  • Change the loan term (for example, from 30 years to 15)
  • Switch from an adjustable-rate mortgage to a fixed rate
  • Tap home equity with a cash-out refinance

Types of refinances

  • 🏠 Rate-and-term refinance

    • Changes your interest rate, loan term, or both
    • No cash is taken out
  • 🏠 Cash-out refinance

    • Lets you borrow more than you owe and take the difference in cash
    • Often used for home improvements, debt consolidation or major expenses
  • 🏠 Streamline refinance

    • Available for FHA, VA and USDA loans
    • Fewer documentation requirements
    • May not require a home appraisal

What lenders look at

Lenders review many of the same factors as with a purchase loan:
  • Income and employment
  • Credit score
  • Debt-to-income ratio
  • Home value and equity

Costs to consider

Refinancing usually comes with closing costs, often 2% to 5% of the loan amount. A refinance makes sense when the long-term savings outweigh these upfront costs.
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Frequently asked questions

  • How do I find the lender with the lowest mortgage rate?

    Some lenders post mortgage rates on their websites and include tools to see how much your rate might be. But those are just estimates. You'll need to get preapproved for a mortgage to get a rate offer based on your credit score and other financial information.
  • How much are closing costs?

    Closing costs are the various fees and expenses you pay to finalize the mortgage. Closing costs typically run between about 2% and 5% of the loan amount. That means on a $300,000 home loan, you could pay $6,000 to $15,000 in closing costs.
  • What if I can't afford closing costs?

    Most state housing finance agencies offer first-time home buyer programs, which can include closing cost and down payment assistance. The assistance can come in the form of a grant, a forgivable loan or a deferred-payment loan. To qualify, you need to work with a lender approved by the state agency.
  • Should I shop for a home or find a lender first?

    You should shop for a lender first and get preapproved for a mortgage before shopping for a house. A mortgage preapproval shows sellers and their real estate agents that you're a serious buyer. It also indicates how much you can borrow, which will help you determine how much home you can afford.