Best Mortgage Lenders
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Min. credit score
Min. down payment
FHA loansBest for FHA and VA loans
FHA loansBest for FHA and home equity loans
VA loansBest for VA loans
Home loans overallBest for first-time buyers, FHA and jumbo loans, HELOCs
Andrews Federal Credit Union: NMLS#410421
Home loans overallBest for first-time home buyers
- Offers FHA purchase, streamline and cash-out refinance loans.
- Offers low rates and fees for FHA loans compared with other lenders, according to the latest Federal data.
- Displays customized rates, with fee estimates, without requiring contact information.
- Branches for in-person service are limited to the Kansas City metro area.
- Dedicates a significant portion of its business to FHA lending.
- Displays custom rate quotes based on home value, down payment, ZIP code and credit score range.
- “Lock & Shop” lets you secure a rate for up to 90 days, even if you don’t have a purchase contract yet.
- FHA interest rates are on the lower end, according to the latest federal data.
- Origination fees for FHA loans are on the higher end, according to the latest federal data.
- Doesn't offer FHA renovation loans.
- Offers a broad selection of home loan products, including low-down-payment options for first-time home buyers and HELOCs.
- Offers a lender credit, based on loan amount, for purchase mortgages.
- Mortgage rates and fees are low compared with other lenders, according to the latest data.
- Does not publish sample mortgage rates on its website.
- The lender credit isn't available for refinance mortgages.
- 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.
- Caters to first-time home buyers with incentives and education.
- Provides extra support for military borrowers, including branches near bases in Germany, Belgium and the Netherlands.
- Offers HELOCs and home equity loans at competitive interest rates.
- Physical branches in the U.S. are limited to Maryland, New Jersey, Virginia and Washington, D.C.
- Does not offer renovation or construction home loans.
- 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 range of affordable mortgage products, including 0% down payment loans, designed for military members.
- Offers HELOCs and home equity loans.
- Offers low rates compared with most lenders, according to the latest federal data.
- Website does not provide customized mortgage rates based on credit score or other factors before you apply.
- Credit union membership is limited to veterans and current military members, their families, and certain federal employees, retirees and contractors.
- Offers a one-day mortgage approval process.
- Offers a generous selection of loans, including government-backed, interest-only, ITIN, jumbo, and renovation loans.
- Advertises a HELOC that can be funded in as few as five business days.
- Receives high marks for customer satisfaction, according to J.D. Power and Zillow.
- Origination fees are higher than average, according to the latest federal data.
- HELOC has a relatively short draw period, which may not provide flexibility for someone who wants the option of accessing home equity over a longer period.
- 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.
- Borrowers can apply entirely online. The lender is also very transparent about what borrowers can expect from the process, including nontraditional customers.
- Borrowers do not need to become members of the credit union until they’ve reached the closing process, meaning that interested home buyers can apply and get rate offers without committing to membership.
- Offers customized rate quotes, including a detailed breakdown of estimated closing costs.
- Does not offer VA, FHA or USDA loans.
- Membership is contingent on belonging to or joining a partner organization, or living in an eligible Chicago-area community.
- A good selection of loan products, including government-backed FHA and VA mortgages.
- Provides a “same-as-cash” loan that allows borrowers to compete with cash offers.
- Closing possible in as few as 15 days, the lender says.
- Doesn't lend in all states.
- Website doesn’t provide customized mortgage rates.
- Lender fees are on the high side, according to the latest federal data.
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.
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 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.
Home equity loans and lines of credit
Homeowners who want to access their home equity without refinancing or selling can take out second mortgages.
A home equity loan offers access to cash based on the value of the home for any expenses, although it is recommended homeowners use the funds for upgrades and repairs that add value to the home. This loan is paid out in a lump sum that is then repaid over a specific amount of time.
A home equity line of credit, or HELOC, also offers cash but works more like a credit card, allowing a homeowner to withdraw funds multiple times, up to the limit of their credit line, during a specific period and then pay it back.
Because both of these options use the home as collateral, a homeowner must understand that failure to make payments could result in loss of the home. As with purchase loans, it’s wise to compare offers from more than one home equity lender.
More from NerdWallet:
Last updated on December 1, 2023
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, jumbo loans, FHA loans, VA loans, home equity lines of credit and home equity loans. In each category, the highest-scoring lenders were selected. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.
NerdWallet's Best Mortgage Lenders of December 2023
- NBKC: Best for FHA and VA loans
- Pennymac: Best for FHA and home equity loans
- PenFed: Best for VA loans
- PNC: Best for first-time buyers, FHA and jumbo loans, HELOCs
- Andrews Federal Credit Union: Best for first-time home buyers
- Flagstar: Best for first-time buyers and jumbo loans
- Navy Federal: Best for VA and home equity loans
- Guaranteed Rate: Best for first-time home buyers and HELOCs
- Truist: Best for HELOCs
- Alliant: Best for jumbo loans
- Network Capital: Best for home equity loans
Frequently asked questions
- Which mortgage lender is the best?
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.
- 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?