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Best Mortgage Lenders of August 2022
Before buying or refinancing, find the lenders that best meet your needs.
Some of our best partner lenders
5.0
/5 NerdWallet ratingat New American Funding
The bottom line
Pros
- Uses manual underwriting to evaluate creditworthiness, in some cases.
- Offers full online mortgage application, rate quotes, document upload and loan tracking.
Cons
- Mortgage origination fees tend to be on the high end, according to the latest federal data.
5.0
/5 NerdWallet ratingat NASB
The bottom line
Pros
- Offers competitive rates and origination fees.
- Considers nontraditional income sources, in some cases.
Cons
- Does not offer home improvement mortgages.
- Doesn't offer home equity loans and lines of credit.
4.0
/5 NerdWallet ratingat Veterans United
The bottom line
Pros
- Offers 24/7 customer service over the phone.
- Has online application and pre-qualification.
- Offers a free credit counseling service.
- Employs advisors from each branch of the armed forces.
Cons
- Doesn’t offer home equity loans or HELOCs.
- Veterans United has physical branch offices in only 17 states.
- Information on FHA, USDA and conventional loans is harder to find on its website.
4.0
/5 NerdWallet ratingat Ally Bank
The bottom line
Pros
- Excels in online convenience, with document upload, loan tracking and e-signatures.
- Offers good rate transparency; rate shoppers can see customized interest rates.
Cons
- Limited variety of loan products: FHA, VA and USDA loans are unavailable.
- Doesn't offer home equity loans and lines of credit.
4.0
/5 NerdWallet ratingat BNC National Bank
The bottom line
Pros
- Wide variety of loan types and products.
- Improved online capabilities, and robust iOS and Android apps.
- Considers alternative credit data, like cell phone payments.
Cons
- Limited number of physical mortgage offices.
- Limited rate information is available without starting an application or speaking with a loan officer.
5.0
/5 NerdWallet ratingat Pennymac
The bottom line
Pros
- Offers a full range of online capabilities, including e-signatures and online loan process tracking.
- Displays custom rate quotes based on home value, down payment or equity, ZIP code and credit score range.
Cons
- Origination fees are on the higher end, according to the latest federal data.
- Doesn't offer jumbo mortgages or home equity lines of credit.
4.5
/5 NerdWallet ratingat PNC
The bottom line
Pros
- Posts current mortgage rates on its website.
- Has an online application for mortgage preapproval and a digital tool to track application progress.
- Offers several affordable loan options, including FHA, VA, USDA and the PNC Community Loan.
Cons
- Doesn't offer renovation mortgages.
- In-person service is not available in every state.
4.5
/5 NerdWallet ratingat NBKC
The bottom line
Pros
- Extends full online capabilities, from application to loan tracking.
- Displays customized rates, with fee estimates, without requiring contact information.
Cons
- Equity lines and construction loans are available only in the Kansas City metro area.
- Doesn’t offer renovation loans.
4.5
/5 NerdWallet ratingat Rocket Mortgage, LLC
The bottom line
Pros
- Caters to self-service users who want to apply for a home loan online and talk to a human only as necessary.
- Estimates the loan amount you’ll qualify for within minutes.
- Streamlines the online process with document and asset retrieval capabilities, including the ability to edit your preapproval letter.
Cons
- Getting a customized interest rate requires a credit check, which can affect your credit score.
- Doesn't offer home equity loans or lines of credit.
- Lender fees are on the high side and the fees aren't offset by particularly low mortgage rates, according to the latest data.
4.5
/5 NerdWallet ratingat SoFi
The bottom line
Pros
- Provides an entirely digital mortgage application.
- Mortgage rates tend to be on the low side, according to the latest available data.
- SoFi members may qualify for a $500 discount on mortgage fees.
Cons
- Does not offer government-backed loans, such as FHA or VA.
- Requires users to create an account to see customized mortgage rates.
- SoFi conforming mortgages are unavailable in Hawaii.
4.5
/5 NerdWallet ratingat Guaranteed Rate
The bottom line
Pros
- Offers the ability to securely upload and digitally sign loan documents.
- Displays detailed sample rates for many of its loan products.
Cons
- Doesn't offer home equity loans or lines of credit.
4.5
/5 NerdWallet ratingat Watermark Home Loans
The bottom line
Pros
- Offers reverse mortgages and interest-only loans for certain borrowers.
- Online capabilities include a full application, as well as loan process updates.
Cons
- Does not offer home improvement loans.
- Fully customized mortgage rates not available without providing contact information.
4.5
/5 NerdWallet ratingat Bethpage Federal Credit Union
The bottom line
Pros
- Offers a full array of online conveniences, including loan process updates.
- Offers financing for cooperatives, a type of home that’s common on the East Coast.
- Sample mortgage rates available for a variety of loan products.
Cons
- In-person service available only on Long Island, New York.
- USDA and renovation loans are not available.
- Customized rates not available online.
NerdWallet's editorial picks for the best mortgage lenders
Best for nontraditional credit histories | |
Best for refinancing | |
Best for first-time home buyers and VA loans | |
Best for digital convenience | |
Best for digital convenience | |
Best for overall mortgage experience | |
Best for first-time home buyers and jumbo loans | |
Best for refinancing | |
Best for rate transparency | |
Best for rate transparency | |
Best for jumbo loans | |
Best for variety of loan types |
Explore our lender roundups
How does a mortgage work?
A mortgage is a loan to purchase a home. The loan is repaid with interest in monthly payments over a certain number of years, such as 15, 20 or 30. If the mortgage isn't repaid, the borrower may lose the home in a multistage process known as foreclosure.
Banks, credit unions and other lenders offer mortgages. To apply, fill out an application and provide documentation about your finances. Lenders consider your income, debts and credit score to decide whether you qualify and the terms to offer.
» MORE: What is a mortgage?
Types of mortgages
There are a variety of mortgages and home loan programs. Here are some of your choices.
Fixed vs. adjustable rates
There are fixed-rate and adjustable-rate mortgages. The interest rate stays the same for the entire loan term of a fixed-rate mortgage. With an adjustable-rate mortgage, or ARM, the interest rate stays the same for a certain period, up to 10 years, and then adjusts at a specified interval, usually every six months.
15-, 20- and 30-year mortgages
The most popular mortgage term is 30 years, but 15- and 20-year mortgages are also available. Mortgage payments are spread out monthly through the term. At the end, the loan is paid off and the borrower owns the property free and clear.
Government-backed mortgages
These loans are backed by the federal government:
FHA mortgages are backed by the Federal Housing Administration. They allow down payments as low as 3.5% and have more lenient credit score requirements than other loan programs. Borrowers must pay for mortgage insurance.
USDA mortgages, backed by the U.S. Department of Agriculture and meant for rural home buyers, do not require a down payment, but borrowers must pay an upfront and annual guarantee fee, similar to mortgage insurance for FHA loans.
VA loans, backed by the U.S. Department of Veterans Affairs, are for veterans and active military members. VA mortgages require no down payment, but borrowers pay a one-time VA funding fee, which can be rolled into the loan.
Conventional loans
Conventional loans are mortgages that are not backed by the federal government. Some conventional loans have down payment requirements as low as 3% — but typically, borrowers must pay for private mortgage insurance if they put down less than 20%.
Conventional mortgages can be conforming or nonconforming. Conforming conventional mortgages fall within certain dollar amount limitations set every year by the Federal Housing Finance Agency. They also meet underwriting guidelines set by Fannie Mae and Freddie Mac, the government-sponsored entities that buy conforming loans.
Nonconforming loans don’t abide by those limits and guidelines. For example, jumbo loans are conventional mortgages that exceed the conforming loan limits. They also typically have stricter criteria for approval than other mortgages.
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. Most borrowers have scores in the high 600s to 700s. FHA loans generally have the most lenient credit score requirements.
How to compare mortgage rates
You can check current mortgage rates to see the average of what lenders are offering. Then get initial quotes online from some lenders based on your location, loan term, purchase price, down payment amount and other factors.
To get a firm quote, you'll need to apply for preapproval. During the preapproval process, the lender will check your credit and verify your financial information, such as income, assets and debts.
How to shop for a mortgage lender
The time to shop for a mortgage lender is before you start house hunting. Getting preapproved for a mortgage will show real estate agents and sellers that you're a serious buyer. It's smart to get preapproved and then get Loan Estimates from more than one lender. The Loan Estimate provides details about the loan terms, monthly payment and estimated closing costs. With those pieces of information, you can compare offers and choose the best deal.
More from NerdWallet:
Last updated on August 1, 2022
Methodology
The partner lenders featured at the top of this page were selected by NerdWallet's business team from our lists of Best Conventional Mortgage Lenders, Best Mortgage Lenders for First-Time Home Buyers, Best Mortgage Refinance Lenders, Best Lenders for FHA Loans, Best VA Mortgage Lenders, Best Mortgage Lenders for Low or Bad Credit Score Borrowers, Best Mortgage Lenders for Jumbo Loans, Best Credit Union Mortgage Lenders and Best Online Mortgage Lenders.
NerdWallet's content team selected its list of lenders based on the following methodology:
NerdWallet's star ratings for mortgage lenders are awarded based on our evaluation of the products and services each lender offers to consumers who are actively shopping for the best mortgage. The four key areas we evaluated include the variety of loan types offered, ease of application, mortgage rate transparency, and our analysis of the rates and fees lenders reported in the latest available Home Mortgage Disclosure Act data. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.
To recap our selections...
NerdWallet's Best Mortgage Lenders of August 2022
- New American Funding: Best for overall mortgage experience
- Veterans United: Best for VA loans
- Ally Bank: Best for jumbo loans
- BNC National Bank: Best for FHA loans
- NBKC: Best for refinancing
- Rocket Mortgage, LLC: Best for refinancing
- SoFi: Best for refinancing
- Guaranteed Rate: Best for first-time home buyers
- Watermark Home Loans: Best for borrowers with weaker credit
- NASB: Best for overall mortgage experience
- Pennymac: Best for FHA loans
- Bethpage Federal Credit Union: Best for credit union lending
- PNC: Best for FHA loans
Frequently asked questions
The answer depends on your needs. Lenders vary by the types of loans and services they offer as well as their credit score minimums and other requirements for borrowers. 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.
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.
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.
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.
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.
