Best Mortgage Lenders for First-Time Home Buyers in 2023
These mortgage lenders cater to first-time home buyers with low down payments, grant programs and educational materials.
Some or all of the mortgage lenders featured on our site are advertising partners of NerdWallet, but this does not influence our evaluations, lender star ratings or the order in which lenders are listed on the page. Our opinions are our own. Here is a list of our partners.
For first-time home buyers, finding the right mortgage can be a big challenge. You want to work with a lender that can give you the best rate, the right term and the lowest closing costs, as quickly and efficiently as possible.
NerdWallet has picked some of the best mortgage lenders for first-time home buyers in a variety of categories so you can quickly decide which one is right for you.
Best Mortgage Lenders for First-Time Home Buyers in 2023
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Lender ▾ ▾ | NerdWallet Rating ▾ ▾ | Min. credit score ▾ ▾ | Min. down payment ▾ ▾ | Learn more |
|---|---|---|---|---|
4.5 /5 | 620 | 3% | ||
5.0 /5 | 620 | 3% | ||
4.0 /5 | 620 | 3% | Top 3 most visited 🏆 Learn moreat Northpointeat Northpointe | |
5.0 /5 | 620 | 3% | ||
4.5 /5 | 620 | 3% |
- Offers government-backed loans and some harder-to-find products, such as construction loans and specialty mortgages for pilots.
- Offers low rates and fees compared with other lenders, according to the latest federal data.
- Displays customized rates, with fee estimates, without requiring contact information.
- HELOCs and construction-to-permanent loans are available only in the Kansas City metro area.
- Offers several low-down-payment loan options, including FHA, VA, USDA and the PNC Community Loan.
- Receives high marks for customer satisfaction, according to J.D. Power and Zillow.
- Mortgage rates are lower than the industry average, according to the latest federal data.
- Jumbo loans available with 5% down payment.
- Doesn't offer renovation mortgages or home equity loans.
- In-person service is not available in every state.
- You’ll have to create an account or supply personal data to get answers by phone.
- Offers government-backed FHA and VA loans, including refinancing options, and USDA loans.
- Jumbo loans available for vacation homes and investment properties.
- Offers programs for borrowers with credit challenges, self-employed borrowers and professionals early in their careers who may still carry significant debt.
- You’ll need to provide contact information or speak to a loan officer for customized mortgage rates.
- Origination fees are on the high side, according to the latest federal data.
- Doesn’t offer home equity loans or lines of credit.
- Multiple loans for those who are renovating or building a home, including loans with interest-only payments during construction.
- Offers home equity loans and lines of credit.
- Offers down payment assistance and loans for underserved borrowers, including ITIN loans and loans with flexible qualifications in certain communities.
- Interest rates are on the low side relative to other lenders, according to the latest federal data.
- Borrowers can enter their information (including their desired loan amount, down payment and zip code) into the lender’s Mortgage Quote Comparison tool and receive a customized rate quote.
- Home equity loans are not available in all locations served by Flagstar.
- In 2022, the lender was fined for violating laws regarding properties in flood zones.
- Offers a wide variety of loan options, including construction loans, programs for early career doctors, a wide variety of jumbo loans and home equity lines of credit.
- Proprietary grant program can help borrowers afford down payment and closing costs.
- Mortgage rates are lower than industry average, according to the latest federal data.
- Customized rates aren't available online without contacting the lender.
- For borrowers who prefer to apply in person, branches are limited mostly to the South and East.
- Mortgages aren’t available in all 50 states.
- Sample rates clearly posted for various loan products.
- Offers a wide variety of loan types and products, including options for borrowers who work for themselves and those without Social Security numbers.
- Mortgage rates tend to be on the low side compared with other lenders, according to the latest federal data.
- Home loans business is broadly focused on bank customers.
- Doesn’t offer home improvement loans, or home equity loans or lines of credit.
- Scandals and government actions have damaged consumer trust in recent years.
- Offers 24/7 customer service over the phone.
- Offers a free credit counseling service.
- Mortgage rates are on the low side, according to the latest federal data.
- Parent company’s mortgage rates are on the higher side, according to the latest federal data.
- Does not offer second mortgage options like home equity loans or HELOCs.
- Convenient online application and loan process updates.
- Offers a variety of mortgage options, including FHA, VA and USDA loans.
- Mortgage interest rates aren't published online.
- Doesn’t offer home equity loans or lines of credit.
- Lender fees are on the high side, according to the latest federal data.
- Offers a wide variety of loan products, including home improvement loans and mortgages for manufactured homes.
- Has retail branches in most states.
- Receives high marks for customer satisfaction, according to J.D. Power and Zillow.
- Does not offer home equity loan products.
- Origination fees tend to be higher, according to the latest federal data.
- Offers a broad selection of renovation loans to finance cosmetic upgrades or structural repairs.
- Issues loan approval letters within 24 hours to borrowers who qualify.
- Offers resources to connect eligible borrowers with closing cost and down payment assistance programs.
- No online mortgage rates — you have to contact the lender for information.
- Rates and fees are on the high side, according to the latest federal data.
- Doesn't offer home equity loans or lines of credit.
How do I choose a mortgage lender?
Once you have an idea of the type of mortgage you're looking for, finding the right lender may be easier than you think, especially when you compare at least three lenders and let them compete for your business. It's likely one lender's mortgage package will rise above the others’ — with a lower rate and lower fees.
» MORE: Tips for first-time home buyers
How do I compare mortgage lenders?
After determining what kind of loan you need, think about what type of service and lending experience is important to you. Maybe you'd prefer to talk to a banker in person at an actual brick-and-mortar bank. Or perhaps minimizing contact is more your style, and you'd like to be able to do almost the entire mortgage process on an app. Depending on what you prefer, you might focus on traditional banks, nonbank lenders, credit unions — or you might decide to have a mortgage broker do the research for you.
Apply for mortgage preapproval with multiple lenders to see how much you might qualify to borrow, what kind of rate you might be offered and also get a taste of what it would be like to work with each lender. In order to see actual interest rates and fees, you'll need to go through with applying for a mortgage with more than one lender. Since that'll cost you an application fee whether or not you go through with the loan, it'll help if you can narrow the field with your preapprovals. Once you've applied for a mortgage, you'll receive a Loan Estimate within three business days. This standard form allows you to compare lenders side by side to see who is offering you the best mix of rates and fees.
How much do I need to save for a down payment?
The amount you'll need for a down payment varies depending on the type of home loan you're using. Conventional loans can offer down payments as low as 3%, though some buyers will make down payments as high as 20% in order to avoid paying private mortgage insurance. FHA loans can come with down payments as low as 3.5%, depending on your credit score. VA loans and USDA loans do not require down payments.
Can I get help making a down payment?
As a first-time home buyer, you may qualify for down payment assistance and other types of first-time home buyer benefits. These programs are generally run by state housing authorities, though depending on where you live, you may find options that are city- or county-specific. Income and residency restrictions may apply, and you'll often have to take a first-time home buyer class in order to qualify for assistance.
More from NerdWallet
Last updated on September 5, 2023
Methodology
The star ratings on this page reflect each lender's overall star ratings. Read more about how we determine those ratings. The lenders on this page are chosen using this methodology:
NerdWallet reviewed more than 50 mortgage lenders, including the majority of the largest U.S. mortgage lenders by annual loan volume (measured among lenders with at least a 1% market share), lenders with significant online search volume and those that specialize in serving various audiences across the country.
All reviewed mortgage lenders that offer programs for first-time home buyers were evaluated based on (1) the portion of their business dedicated to FHA and VA lending, (2) their ability to offer conventional loans with a down payment as low as 3%, (3) their origination fees, (4) their proprietary first-time home buyer loans or assistance (e.g. grants or loans to cover down payment and closing costs), (5) mortgage rate transparency, and (6) the ease of their online application. The highest scoring lenders appear on this page.
NerdWallet solicits information from reviewed lenders on a recurring basis throughout the year. All lender-provided information is verified through lender websites and interviews. We also utilized 2021 HMDA data for origination volume, origination fee, average interest rate and share-of-product data.
NerdWallet's Best Mortgage Lenders for First-Time Home Buyers in 2023
- NBKC: Best for online experience
- PNC: Best for low down payments
- Northpointe: Best for digital convenience
- Flagstar: Best for rate transparency
- Truist: Best for digital convenience
- Wells Fargo: Best for variety of loan types
- Veterans United: Best for digital convenience
- Sebonic Financial: Best for variety of loan types
- Guild Mortgage: Best for first-time home buyers overall
- PrimeLending: Best for variety of loan types
Frequently asked questions
- What type of loan is best for a first-time home buyer?
The best mortgage for you as a first-time home buyer is the loan for which you're most qualified. And that depends on a number of factors, including your credit score. With a credit score of at least 580, you may find that a loan backed by the FHA is your best option. With a credit score around 620 or higher, a conventional loan might be a better option, and could require an even lower down payment of 3%.
- What programs are available for first-time home buyers?
Many grants, special loans and down payment assistance programs are available to borrowers looking to buy their first home. These first-time home buyer programs are offered by agencies in the state where you live.
- What is the easiest home loan for a first-time home buyer to get?
The loan program that's easiest to qualify for is an FHA-backed loan. That's because FHA loan requirements allow a lower credit score and less stringent debt-to-income guidelines than conventional loans. However, if you’re a first-time buyer with strong credit, conventional loans may allow even lower minimum down payments than an FHA loan.
