Are you ready to buy a house and learn how to get a mortgage loan? It can be overwhelming to find the right mortgage to fit your budget. Luckily, shopping around for the best mortgage doesn’t have to be painful — particularly if you know what you’re looking for.
We’ll show you how to get a mortgage and choose the best mortgage company for you. Remember, mortgage brokers can only take you so far and that's why it's important to find the best mortgage lenders for first-time buyers. You deserve extra support and information that you will find below.
Quick Look at the Best Mortgage Lenders:
The Best Mortgage Lenders
Take a look at who made the list for best mortgage lenders nationwide. Potential homebuyers wondering how to get a home loan should remember that mortgage interest rates, the online process, closing costs, etc. will vary from one lender to another.
1. New American Funding
New American Funding offers conventional, proprietary and government-backed mortgages. Its variety of mortgage options makes it worth checking out, especially if you have unique financial needs. It also offers options for refinancing and tapping into your home equity. Its loan products aren’t available to New York or Hawaii residents.
New American Funding is a good choice for self-employed borrowers. It allows you to use bank statements to verify your income instead of trying to qualify with tax returns, W-2s or pay stubs, which you might not have with a fluctuating or lump-sum income.
New American Funding is also an excellent lender for first-time home buyers. You can opt for an FHA, USDA or VA loan. New American Funding also has educational resources to help you understand the mortgage process.
It may also be a good fit for senior homeowners looking for a reverse mortgage. A reverse mortgage allows you to take advantage of the equity you’ve built up in your home. It’s not for everyone, but it’s worth considering if you’ve built up significant equity in your home but have concerns about your income in retirement.
New American Funding recommends you have a credit score of at least 640 and are ready to provide a downpayment of 20%.
2. Rocket Mortgage®
Rocket Mortgage® offers a convenient online application process to get a mortgage. It’s a major draw for homebuyers since employment and income can be instantly verified for over 60% of U.S. applicants and can speed up the loan processing time.
Rocket Mortgage® is 1 of the top lenders across the nation, particularly for FHA loans. It offers FHA, VA, USDA, conventional fixed, jumbo and refinancing loans. You will find the current VA mortgage rates by contacting them.
You’ll need a 620 credit score for approval (580 for FHA loans) and should be ready to provide a down payment of 3.5%. On the downside, Rocket Mortgage® does not offer home equity loans or HELOCs and does not consider alternative credit.
3. CrossCountry Mortgage
- CrossCountry MortgageMore DetailsBest ForSelf-employed Borrowers
Available in: CA, CO, CT, DC, FL, GA, IL, MD, MA, MI, NH, NJ, NY, NC, OH, PA, RI, SC, TN, TX, VA, WA
CrossCountry Mortgage makes it easy for all types of home buyers to get approved for a mortgage. Their flexible requirements can help you get financing, with no employment or income verification and no minimum DTI. CrossCountry Mortgage offers traditional loan terms, as well as more flexible mortgage payment plans with its 40-year loan program. It's one of the best local mortgage lenders.
It’s also easier to get approved if you’re self-employed. Tax returns are not required and you’ll only need 1 year of self-employment income history and a minimum credit score of 580. CrossCountry Mortgage can also help you get approved on assets alone, like your bank statements, stocks and bonds, or retirement accounts.
CrossCountry Mortgage is licensed to lend in California, Colorado, Connecticut, DC, Florida, Georgia, Illinois, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Virginia, and Washington.
4. Angel Oak Home Loans
- Angel Oak Home LoansMore DetailsBest ForFlexible Mortgage Options
Angel Oak Home Loans is a full-service mortgage lender offering traditional and portfolio Non-QM mortgage loans. Angel Oak is licensed in 45 states and offers competitive rates and quick closing times.
- Available for purchase, cash-out or rate-term refinance
- Primary, second home, or investment properties
- Single-family, townhomes, or condos
- Loan amounts up to $3.5 million
- No tax return options for self-employed borrowers and real estate investors
- 1099 income options available
- Government loan products available (FHA, USDA, VA)
- Competitive rates on conventional purchases and refinance
- Flexible down payment options
- Non-warrantable condos allowed
What to Look for in a Mortgage Company
Thanks to technology, getting pre-approved for a mortgage is easier than ever. A few simple clicks can gain you the coveted “pre-approved” status that will make closing on your dream home morph into reality. But it’s important to explore all of your options before deciding on a mortgage.
Be sure to search for the right mortgage company to fit your specific financial situation. Whether you want a brick-and-mortar lender or want to look for the best online mortgage lender, there are 2 common routes you should explore before you narrow down your mortgage lender:
- Brick-and-mortar lenders. This type of lender is a traditional banking institution — you can sit down and talk to a loan officer in person. These lenders include banks and credit unions, both of which help buyers navigate the home-buying process. Many brick-and-mortar lenders offer government and conventional loan options as well as online services.
- Online mortgage lenders. Online lenders streamline the mortgage application process by providing clear, easy-to-follow application steps. Online lenders allow buyers to handle all financial applications, verifications and online approvals. Online mortgage lenders may also provide access to loan officers who can connect with you online or via phone to answer any questions.
Be sure your lender offers services that are important to you, like online applications, customer service assistance or fast pre-approvals.
Now that you understand the 2 main types of lenders, it’s important to understand the different types of mortgages to consider.
- Government-backed mortgages. This type of loan is considered more secure because it’s backed by the federal government. Government-backed loans are ideal for low-income and first time homebuyers and those with bad credit. Down payment requirements are generally lower on these loans (typically between 0% to 3%). FHA, USDA and VA loans are the most popular government-backed loans.
- Conventional mortgages. Conventional mortgages are home loans that aren’t backed by the U.S. government. You’ll typically need good credit, proof of income and a 3% to 20% down payment which is the average down payment on a house. Conventional mortgages include fixed-rate mortgages (you pay a fixed rate over a set amount of time) and adjustable-rate mortgages (you pay an adjustable-rate over a set amount of time).
- Refinancing, home equity or HELOC mortgages. These loans are ideal if you’d like to refinance or borrow against your home’s current equity.
- Preapproval. Real estate agents will expect mortgage preapproval before they start showing homes, and you need to know that you will get exceptional service as the process begins.
Know The Current Mortgage Rates
It's important to understand current mortgage rates when shopping for a mortgage loan product. This will allow you to ensure you're receiving a fair mortgage rate from the lenders you're considering and help you estimate your monthly payment.
The interest rate on a mortgage will vary based on the loan term and whether it's a fixed-rate mortgage or an adjustable-rate mortgage. The mortgage loan officer can help you decide which mortgage term and loan type are best for you and provide you with an estimated monthly payment for each.
Plus, keep in mind that you may need a loan for your down payment, an advance on the mortgage that could keep your payments down.
5 Tips for Finding the Best Mortgage Lender
Take some time to comb through Benzinga’s tips so you get the ideal mortgage lender for you.
Determine your down payment
It’s important to understand how your down payment can impact your mortgage rate, options and monthly fee before you even think about diving into a mortgage application. Saving for a 20% down payment is no longer a requirement, but there are plenty of reasons why a larger down payment may be a smart idea. Many conventional and government-backed loans allow you to put less than 20% down on a home so you’ll want to be aware of the cost of private mortgage insurance (PMI).
PMI is monthly insurance that you’re required to pay when your down payment is less than 20%. Note: This monthly insurance protects the lender — but it doesn’t protect you, the borrower. Once you know how much of a down payment you can afford, you can better assess which type of mortgage is best for you and find a lender that meets your financial needs.
Know your credit score
There are methods for securing a mortgage with bad credit but it’s important to know where your credit stands. Homebuyers with higher credit scores often have access to more mortgage products, additional options and better rates. Are you repairing your credit? It can be worthwhile to search for a lender that uses alternative credit to help verify your eligibility.
Alternative credit sources can include rent and utility payments. Applicants with low credit scores should expect slightly higher mortgage rates — it’s still important to shop around to find the best possible rate.
Explore local options
Nationwide banks and online lenders might be the most recognizable names in the mortgage world, but exploring local options can help you unlock additional options. Review any credit union memberships you belong to so you can see how they stack up against competitors.
Talk to your agent
It’s important to do your own research when you select a mortgage company. Benzinga has compiled a few top-rated lenders you should explore.
Your buyer’s agent is a valuable resource who can help you navigate through all steps of the home-buying process — including financing your home. Your agent will likely have connections to popular local lenders and can provide advice on which type of mortgage might be best for your budget.
Conduct outside research
Once you have a solid understanding of your finances and have reviewed local options, you’ll want to research lenders to find out more about the specific mortgage offerings they provide. Be sure to review their rates and compare any features and benefits that are important to you. Talk to loan officers to find out if you qualify for any special programs, like first-time home buyer loans or state assistance programs that could reduce your rate or down payment requirement.
Choose the Best Mortgage Company
Finding the right type of mortgage is just as important as finding the right home. Research the options that best suit your financial lifestyle to help you narrow down relevant lenders. Be sure to explore local lenders, compare rates and talk to your agent for further guidance.
Take your time — a lender might not be the right fit for you if it tries to rush you through the process. Start with our recommended lenders to find your perfect fit today.
Frequently Asked Questions
How do you apply for a mortgage?
To apply for a mortgage you must first fill out a mortgage application. Next, you will want to review your loan estimates and commit to a lender. Then you will want to get pre-approved to borrow at a given loan and find your home.
Get Ready for Take Off
Rocket Mortgage® is an online mortgage experience developed by the firm formerly known as Quicken Loans®, America’s largest mortgage lender. Rocket Mortgage® makes it easy to get a mortgage — you just tell the company about yourself, your home, your finances and Rocket Mortgage® gives you real interest rates and numbers. You can use Rocket Mortgage® to get approved, ask questions about your mortgage, manage your payments and more.
You can work at your own pace and someone is always there to answer your questions — 24 hours a day, 7 days a week. Want a fast, convenient way to get a mortgage? Give Rocket Mortgage® a try.