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Best Lenders for No- and Low-Down-Payment Mortgages in 2019

NerdWalletJuly 2, 2019

At NerdWallet, we strive to help you make financial decisions with confidence. To do this, many or all of the products featured here are from our partners. However, this doesn’t influence our evaluations. Our opinions are our own.

There are a lot of ways to get a mortgage with a low or no down payment, with obvious advantages — and disadvantages, too. Find out more, and compare lenders who make it an option.

Rocket Mortgage

at Rocket Mortgage

at Rocket Mortgage

Min. Credit Score

620

Min. Down Payment

3%

Pros

  • The site caters to self-service users who want to apply for a home loan without talking to a human unless it’s absolutely necessary.
  • With your authorization, accesses asset statements from 98% of U.S. financial institutions.
  • Tells you the loan amount you’ll qualify for within minutes.
  • Rocket Mortgage’s document and asset retrieval capabilities can save you a bunch of time and hassle.

Cons

  • Doesn't offer home equity loans or HELOCs.
  • If you’re a “look me in the eye” type of customer, you’re out of luck.
  • Doesn’t consider alternative credit data. It just looks at credit scores and debt-to-income ratios, the way most mortgage lenders always have.
Read full review
Quicken Loans

at Quicken Loans

at Quicken Loans

Min. Credit Score

620

Min. Down Payment

3%

Pros

  • Quicken Loans couples a fully online application with available mortgage advisors for those who want a human touch.
  • Instantly verifies employment and income for more than 60% of working Americans.
  • Offers custom fixed-rate loan terms that are between eight and 30 years.
  • Provides FHA-backed loans, USDA loans as well as products offered by Freddie Mac and Fannie Mae that require down payments as low as 3%.

Cons

  • Doesn't offer home equity loans or HELOCs.
  • If you’re a “look me in the eye” type of customer, you’re out of luck.
  • Doesn’t consider alternative credit data. It just looks at credit scores and debt-to-income ratios, the way most mortgage lenders always have.
Read full review
Vylla

at Vylla

at Vylla

Min. Credit Score

620

Min. Down Payment

3%

Pros

  • Low minimum credit score.
  • Online application, loan tracking and document upload.
  • Free rate locks.

Cons

  • No online preapproval.
  • No presence in Massachusetts or North Dakota.
Read full review
Min. Credit Score

620

Min. Down Payment

3%

Pros

  • Embraces FHA-backed home loans.
  • Offers three construction loan offerings.
  • A professional loan package is tailored for the needs of doctors, lawyers, architects and certified public accountants.
  • Flagstar reps are familiar with low-down-payment state bond programs for first-time home buyers and income-limited households, as well as the areas that qualify for USDA loans.
  • Offers home equity loans and home equity lines of credit.

Cons

  • Charges an average $1,000 origination fee.
Read full review
Min. Credit Score

620

Min. Down Payment

3%

Pros

  • Allows borrowers to apply entirely online.
  • Offers down payment and closing cost assistance programs.
  • Accepts alternative credit data for some loan types.
  • May give existing customers a discount on mortgage lender origination fees.

Cons

  • Charges an application fee of $1,170, on average.
  • Has a high volume of consumer complaints, even for a big national bank.
Read full review
Min. Credit Score

620

Min. Down Payment

3%

Pros

  • Considers nontraditional credit history like rent payments.
  • Online tools help you estimate mortgage payments and track application progress.
  • Several affordable loan options including FHA, VA, USDA and the PNC Community Loan.

Cons

  • It's not possible to complete the entire mortgage process online.
  • Offers mortgage loans nationwide, but has branches in only about two dozen states.
Read full review
Min. Credit Score

620

Min. Down Payment

3%

Pros

  • Offers a complete online suite of mortgage application tools and loan tracking.
  • Has plenty of loan options to choose from and competitive interest rates.
  • Provides customer service in its physical locations, online, via chat and by phone.
  • Has a Doctor Loan Program for medical professionals who have high earning potential but little cash for down payments.

Cons

  • Has a limited number of physical branch locations in 11 states and Washington, D.C.
  • Does not consider alternative scoring data, such as rent or utility payments, in standard underwriting.
Read full review
National / Regional

National

Min. Down Payment

3%

Pros

  • Low down payment options.
  • Discounts for Citibank customers.
  • Looks at alternative credit data like rent history and child support payments.
  • Available in all 50 states.

Cons

  • Charges a mortgage application fee.
  • Did not disclose origination fees, which may vary.
  • Can't complete loan online.
Read full review
National / Regional

National

Min. Down Payment

0%

Pros

  • Wide range of affordable mortgage products designed for military members.
  • Willing to look at nontraditional credit data, such as rent payments, as part of its credit evaluation for certain products.
  • Lower minimum loan amounts than many other lenders.
  • Online application for preapproval with quick decision.
  • $1,000 mortgage rate match program.
  • Operates nationwide.

Cons

  • Charges application and underwriting fees.
  • Origination charge on a typical conventional loan is 1% of the loan amount.
Read full review
SoFi

at SoFi

at SoFi

National / Regional

Regional

Min. Down Payment

10%

Pros

  • Charges no application or origination fees.
  • Provides an entirely digital mortgage application to make the process easier for borrowers.
  • Considers nontraditional income, such as restricted stock units, and works with self-employed borrowers.

Cons

  • Doesn't offer government-backed loans, like FHA or VA.
  • Does not offer home equity loans or HELOCs.
Read full review

Summary of Best Lenders for No- and Low-Down-Payment Mortgages in 2019

LenderBest For

Minimum Credit Score

Minimum Down PaymentLearn More
Rocket Mortgage

Rocket Mortgage

at Rocket Mortgage

online experience

620

3%

at Rocket Mortgage

Quicken Loans

Quicken Loans

at Quicken Loans

overall zero- and low-down-payment lender

620

3%

at Quicken Loans

Vylla

Vylla

at Vylla

low credit score or nontraditional credit history

620

3%

at Vylla

Flagstar

Flagstar

overall zero- and low-down-payment lender

620

3%

Read review
Bank of America

Bank of America

traditional bank

620

3%

Read review
PNC

PNC

traditional bank

620

3%

Read review
SunTrust

SunTrust

first-time home buyers

620

3%

Read review
Citibank Mortgage

Citibank Mortgage

first-time home buyers

N/A

3%

Read review
Navy Federal

Navy Federal

low credit score or nontraditional credit history

N/A

0%

Read review
SoFi

SoFi

at SoFi

online experience

N/A

10%

at SoFi

LenderBest For

Minimum Credit Score

Minimum Down PaymentLearn More
Rocket Mortgage

Rocket Mortgage

at Rocket Mortgage

online experience

620

3%

at Rocket Mortgage

Quicken Loans

Quicken Loans

at Quicken Loans

overall zero- and low-down-payment lender

620

3%

at Quicken Loans

Vylla

Vylla

at Vylla

low credit score or nontraditional credit history

620

3%

at Vylla

Flagstar

Flagstar

overall zero- and low-down-payment lender

620

3%

Read review
Bank of America

Bank of America

traditional bank

620

3%

Read review
PNC

PNC

traditional bank

620

3%

Read review
SunTrust

SunTrust

first-time home buyers

620

3%

Read review
Citibank Mortgage

Citibank Mortgage

first-time home buyers

N/A

3%

Read review
Navy Federal

Navy Federal

low credit score or nontraditional credit history

N/A

0%

Read review
SoFi

SoFi

at SoFi

online experience

N/A

10%

at SoFi

Low- and no-down-payment FAQs

What’s the catch with no- and low-down-payment home loans?

It depends on the type of loan you apply for. With FHA loans there can be geographic loan limits that put a cap on the price of the home you can buy. On HomeReady and Home Possible conventional loans, there can be income limits or a requirement that you are a first-time home buyer.

Other loan programs are available to borrowers in some low-income regions. There are local and regional low-down-payment mortgage programs, with various criteria needed to qualify.

» MORE: Check out first-time home buyer programs in your state

Do I have to be a first-time home buyer for a low- or no-down-payment mortgage?

Not always. For example, some low-down-payment loans are assisting buyers in economically disadvantaged areas, or catering to borrowers with military connections, such as with VA loans. USDA loans are looking to boost buyers in rural and suburban areas.

Some conventional loans, such as HomeReady and Home Possible, have income limits rather than first-time home buyer requirements — though the programs also have first-timer spinoffs.

» MORE: HomeReady and Home Possible allow 3% down

What’s the credit score required for a low- or no-down-payment mortgage?

To qualify for the lowest 3.5% down payment on an FHA loan, you’ll need at least a 580 credit score or better. With a score between 500 and 579, you’ll need a 10% down payment.

On conventional loans, a 620 or better is generally required.

For borrowers who have a military connection, VA loans don’t have credit score requirements — they’re based more on an applicant’s ability to repay the loan.

However, lenders often require a 620 FICO score even on VA loans and can add their own credit score and other qualifications, so it’s always a good idea to shop more than one lender.

» MORE: FHA loan credit score requirements

Are there income limits on low-down-payment home loans?

Sometimes but not always. In today’s “3% down is the new normal,” there is often a workaround. Income over the threshold? First-time buyers are excluded from such limitations. Same goes if you’re buying in a particular targeted area, or if you’re a military veteran.

Yet, just because you can put just a little down doesn’t always mean you should. If you have a really good income, consider your down payment options along with everything else such as how long you plan to stay in the home and what’s a comfortable monthly payment.

» MORE: What down payment is required?

Can I get a low- or no-down-payment home loan with bad credit?

Sure. Lenders are looking to make good loans. If you have the income and recent payment record that shows an ability and willingness to repay a loan, you can qualify — even with a checkered credit history.

But the setback that dinged your credit has to be in the past. If you’re still worrying about paying your bills paid on time, it’s best to wait on buying a house, no matter how tempting low down payments may be.

» MORE: How credit score affects your mortgage rate

More from NerdWallet

Last updated on July 2, 2019

Methodology

NerdWallet's selection of mortgage lenders for inclusion here was made based on our evaluation of the products and services that lenders offer to consumers who are actively shopping for the best mortgage. The six key areas we evaluated include the loan types and loan products offered, online capabilities, online mortgage rate information, customer service and the number of complaints filed with the Consumer Financial Protection Bureau as a percentage of loans issued. We also awarded lenders up to one bonus star for a unique program or borrower focus that set them apart from other lenders. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.

To recap our selections...

NerdWallet's Best Lenders for No- and Low-Down-Payment Mortgages in 2019

  • Rocket Mortgage: Best for online experience
  • Quicken Loans: Best for overall zero- and low-down-payment lender
  • Vylla: Best for low credit score or nontraditional credit history
  • Flagstar: Best for overall zero- and low-down-payment lender
  • Bank of America: Best for traditional bank
  • PNC: Best for traditional bank
  • SunTrust: Best for first-time home buyers
  • Citibank Mortgage: Best for first-time home buyers
  • Navy Federal: Best for low credit score or nontraditional credit history
  • SoFi: Best for online experience