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4 Tips for Finding the Best Online Mortgage Lenders

May 9, 2018
Mortgage Process, Mortgages
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Technology is changing mortgage lending, making it faster and simpler to get a home loan. You still may have to dig up some documents from your files these days, but you can’t beat the convenience of applying for financing, say, on your phone during a lunch break.

How to look for an online mortgage lender

Since not every lender offers a fully digital mortgage and your experience can differ from one lender to the next, it’s a good idea to find a company that offers an online experience that meets your expectations. These four tips will guide you to the right fit.

Finding the best mortgages and online lender experience for you depends on understanding your financial situation. It’s easy to find generic mortgage rates online. But to learn the rates you may qualify for, you’ll need to know your credit score. Knowing what you can afford to spend on a home and how much you can borrow round out the financial picture.

» MORE: Find out how much how you can afford

With these details in hand, you’ll be able to see if you meet the qualifications for different mortgage products and determine which lenders offer the loans you need.

Options offered by online lenders can vary greatly. For instance, that company with the cool app may not offer the 30-year fixed-rate Federal Housing Administration mortgage with a low down payment that you need. Lenders also may not offer jumbo loans, which, in most parts of the country, are mortgages over $453,100.

As you shop, verify online or ask each lender right away if it has the types of mortgages that might work best for you.

» MORE: Find out how much you can borrow

Even if they work and bank online, many customers still like being able to phone a lender or go into a branch office with their mortgage questions. See if you’ll have these options:

  • Web chat. Chat support is handy while completing an online application. Check for it on a lender’s site and test it out.
  • Customer service. Is a customer support number readily available? Call it to see if you can easily locate someone who’s knowledgeable about mortgages. Verify customer service hours on weekends and evenings if you anticipate you may need help at these times.
  • Face-to-face support. Might you want in-person help? Check whether there are branches near you and whether they have in-house mortgage experts.
  • Some of the platforms that process online applications are made to handle standard, uncomplicated loan requests — perfect for borrowers who, for example, want a conventional mortgage, have good credit and whose income is reported on W-2 forms.

    Not everyone fits that mold. That means, for instance, if you are self-employed, are buying a home that’s unique and hard to appraise, or have a history of credit problems or a low credit score, your application could stand the best chance with a lender that supports borrowers with more complicated situations. Online lenders you are considering should have loan officers who can help you decide if their loan products and online application process are a good fit.

    » MORE: How to apply for a mortgage

    When you’ve found two or three online lenders you like, try out their online systems by applying online for a mortgage preapproval with each. It involves giving a lender permission to view your credit report and financial history so you can receive written offers of loan amounts and interest rates.

    Getting preapproved requires producing much of the same information you’ll need when applying for a mortgage:

    • Borrowers’ Social Security numbers
    • Income and tax records
    • Down payment amount and sources
    • Salary and employer information
    • Bank and investment account information
    • A list of outstanding debts

    Getting and comparing several preapproval offers saves money by giving you a chance to compare annual percentage rates and other loan terms. It’s best to complete all of your applications within 14 days so that they show up on your credit report as a single inquiry.

    Making these applications also gives you a chance to size up a lender’s digital platform. The right digital platform and mobile app let you manage the whole process online, from beginning (pre-qualification, preapproval or mortgage application) to the end (managing your brand-new mortgage).

    Depending on a lender’s technology, features to look for include the ability to order an appraisal, upload and download documents, sign paperwork electronically, schedule the loan closing and sign the closing papers — all online. Explore and compare lender websites to see which tools and approaches you prefer. Also, find the lender mobile apps that are compatible with your device and read user reviews.

     

    Here are highlights of lenders who provide the best mortgage experience online. For more recommendations, see our complete list of the best online lenders of 2018.

    Best online mortgage lenders overall

    These online lenders offer a combination of sophisticated lending technology and a variety of mortgage products.

    Rocket Mortgage
    • Sophisticated online application backed by online support from mortgage advisors
    • Learn in minutes how much you qualify to borrow
    • Products include FHA, VA, USDA and conventional purchase and refinance
    • Rocket Mortgage review
    • Completely online mortgage application
    • Offers FHA, USDA and VA purchase, refinance and cash-out refinance
    • Works with well-qualified customers who have low down payments
    • Guaranteed Rate review

    Best online mortgage lenders for first-time home buyers

    First-time buyers often look for government-backed loans and mortgages that require less money down. These online lenders have products and expertise to meet those needs.

    Quicken Loans
    • FHA, USDA, Freddie Mac and Fannie Mae loans with down-payments as low as 3%
    • Offers first-time buyers online education and loan information
    • Can auto-import borrower data from most U.S. financial institutions
    • Quicken Loans review
    suntrust mortgage
    • Help offered online, by phone and at branches — in English and Spanish
    • Fixed and adjustable FHA, VA, USDA, jumbo and conventional mortgages
    • Affordable loans and mortgage insurance discounts for qualifying low- to moderate-income borrowers
    • SunTrust mortgage review

    Best online lenders with a traditional mortgage background

    These mortgage lenders combine their deep experience with online technology.

    • Suite of online tools for borrowing and managing a mortgage
    • Down payments as low as 3%
    • FHA, VA, home equity and refinance with variety of loan terms
    • Bank of America Mortgage review
    • Apply, track the application and manage a mortgage with any device
    • Can consider nontraditional credit history with an FHA mortgage application
    • PNC mortgage review

    Summary: Best online mortgage lenders

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