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Standout FHA lenders

If you have a lower credit score or are looking for a low down payment, Federal Housing Administration (FHA) loans may be the right option for you. However, they can be more complicated.

2018 FHA loan requirements

A credit score of at least 500, a down payment of at least 3.5% (depending on your credit score), a debt-to-income ratio of no more than 50% and two credit accounts (ex: a credit card and a car loan) are a few of the things you'll need.

Remember, you’ll also want to take into account mortgage insurance premiums since they are required by FHA lenders. The mortgage insurance protects the lender from borrower defaults.

Get quotes from multiple lenders

It’s always smart to shop at least three lenders before taking out a mortgage. That way you can compare all-in costs. Once you have multiple offers in your hand, you can compare loan terms such as fees, rates, time to close, the availability of online application and loan tracking, and customer service offerings.

Quicken Loans

at Quicken Loans

4.5

NerdWallet rating 

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 many working Americans.
  • Offers custom fixed-rate loan terms that are between eight and 30 years.
  • Provides a wide variety of loan types, including renovation loans and all government-backed mortgage products.

Cons

  • Quicken Loans doesn't offer home equity loans or HELOCs.
  • Quicken's lender fees can be stout and it doesn't offset those fees with particularly low mortgage rates.
Read full review
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 many working Americans.
  • Offers custom fixed-rate loan terms that are between eight and 30 years.
  • Provides a wide variety of loan types, including renovation loans and all government-backed mortgage products.

Cons

  • Quicken Loans doesn't offer home equity loans or HELOCs.
  • Quicken's lender fees can be stout and it doesn't offset those fees with particularly low mortgage rates.
Read full review
Rocket Mortgage by Quicken Loans

at Rocket Mortgage by Quicken Loans

4.5

NerdWallet rating 

at Rocket Mortgage by Quicken Loans

Min. Credit Score

620

Min. Down Payment

3%

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.
  • Offers document and asset retrieval capabilities.

Cons

  • If you’re a “look me in the eye” type of customer, you’re out of luck.
  • Getting a customized interest rate requires a credit check, which can lower your credit score by a few points.
Read full review
Min. Credit Score

620

Min. Down Payment

3%

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.
  • Offers document and asset retrieval capabilities.

Cons

  • If you’re a “look me in the eye” type of customer, you’re out of luck.
  • Getting a customized interest rate requires a credit check, which can lower your credit score by a few points.
Read full review
New American Funding

at New American Funding

4.5

NerdWallet rating 

at New American Funding

Min. Credit Score

620

Min. Down Payment

3%

Pros

  • Uses manual underwriting to evaluate creditworthiness.
  • Offers full online mortgage application, rate quotes, document upload and loan tracking.

Cons

  • Mortgage rates offered to borrowers are higher than the government-reported median of all lenders.
Read full review
Min. Credit Score

620

Min. Down Payment

3%

Pros

  • Uses manual underwriting to evaluate creditworthiness.
  • Offers full online mortgage application, rate quotes, document upload and loan tracking.

Cons

  • Mortgage rates offered to borrowers are higher than the government-reported median of all lenders.
Read full review

What if you don’t meet all FHA requirements?

“FHA’s standard underwriting criteria is rolled up into a ‘scorecard’ that considers many factors related to income and debt,” Brian Sullivan, HUD public affairs specialist, told NerdWallet. “Under certain conditions, particularly when a borrower doesn’t fit into our general scorecard requirements, a manual underwriting is required.”

That means if your situation doesn’t neatly fit within all the guidelines, a lender may consider your loan application as a one-off instance, an exception. Frankly, lenders aren’t always eager to do that.

As an alternative, you can work on getting preapproved for your mortgage loan to lock in your interest rate.

Rating methodology:

NerdWallet’s star ratings for mortgage lenders are awarded 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.

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