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Best Virginia Mortgage Lenders for First-time Home Buyers

Buying your first home is an exciting experience. You may feel as though you have quite a bit to learn if you’re a Virginia first-time home buyer and you’re just starting your search. But if you can overcome your first hurdle of landing preapproval from a lender, you’ll be well on your way to homeownership. Start by knowing which lenders to shop, and Benzinga can help you.

Get a Mortgage Quote in Virginia
Tip: compare 2-3 lenders

The Best Mortgage Lenders in Virginia are:

The Housing Market in Virginia: An Overview

Location is everything when it comes to getting a good deal on a house. Here’s a quick overview of the housing market in Virginia.

Total households: 2.7 million

Median list price: $300,000

3 most expensive cities in Virginia to buy a house:

  • McLean
  • Great Falls
  • Clifton

3 most affordable cities in Virginia to buy a house:

  • Covington
  • Alberta
  • Bloxom

Preparing for a Mortgage

The home search process for first-time buyers begins with a serious look at your own financial situation. Here are a few things you can gather before you approach a lender — it could increase your chances of preapproval.

  • Check your credit score. You’re entitled to one free credit report each year. Go to annualcreditreport.com or call 1-877-322-8228. You’ll need to verify your identity with information like your Social Security number and date of birth. Try to aim for a credit score of at least 600. If you don’t quite have that score, work to improve it before you approach lenders.
  • Save for a down payment. Some lenders may require you to put at least 3% down on the purchase price of a home. However, you may find you need 5% or more. Make sure you have this amount set aside before you approach a lender.
  • Research the market. You’ll probably want to apply for preapproval before you begin your search. It can help to know what homes in your area cost so you get a vague idea of how much you’ll need to save for your down payment.
  • Gather your paperwork. Be prepared to hand over requested documentation on short notice to qualify for a mortgage. Pull W-2 forms from the previous year, as well as recent pay stubs. You should also have documentation of any other income you claim, as well as 60 days of bank statements. You’ll also need to list your monthly debts, so a close look at those bank statements can be a big help.
  • Get a purchase quote. Before you start looking for a house, shop various lenders and find the one with the best customer service and interest rate offerings. Request preapproval from any you believe would be a good fit. Pay close attention to the amount a lender will finance. This will give you a price range as you start your home search.
  • Start shopping. Whether you work with a real estate agent or look for a home on your own, a preapproval letter from a lender can help, especially if you’re in a competitive market. Proof of financing could give you an edge over the competition when you do find a home you like and you put an offer in.
LenderMinimum Credit Score Required
The Money Store650
Credible Refinancing600
SunTrust620
Alliant Credit Union620
North American Savings Bank620

Mortgage Options

There’s more than one type of mortgage. Here are a few types of mortgage options you can consider.

  • Conventional loans are the most common type of loan on the market — they are not backed by the government. You might want to consider this option if you have a larger down payment ready to go. You can save on the mortgage insurance a lender will require to protect its investment. If you don’t have that amount for a down payment, lenders will likely steer you toward another type of loan.
  • FHA loans are a popular option for first-time homebuyers. The Federal Housing Administration backs these loans, so you can get away with down payments as low as 3%. They also usually come with better interest rates than you’d be able to find with a conventional loan. Virginia also offers down payment assistance programs if you’d like to look into more help.
  • USDA loans are great for purchasing in a rural area. Check to see if your target area qualifies for a USDA rural development-backed loan. Believe it or not, you could also find a USDA loan even if you live by a major city. These loans also benefit from lower down payments and competitive interest rates.
  • VA loans are backed by the Veterans Administration. You won’t have to put any money down and you’ll also be able to get a lower interest rate.
  • Jumbo loans apply to conventional mortgages that exceed the government’s limits. If you’re looking at homes generally $484,350 and higher, check the maximums for your area. A jumbo loan will come with higher interest rates and stricter requirements.

First-Time Home Buyer Programs in Virginia

First-time homebuyers can also check into any government assistance available. There are several programs that can help offset the cost of buying a home in Virginia.

  • Down Payment Assistance Grant: This program, from the Virginia Housing Development Authority, offers up to 2.5% of the purchase price toward closing cost assistance. You’ll need to have a credit score in the 600s and your debt can’t exceed 45% of your income to qualify.
  • Fannie Mae HFA Preferred: Need help with mortgage insurance? You’ll find two programs — you’ll pay no insurance premiums and another where the premiums you pay are dramatically discounted.
  • Granting Freedom: Military veterans may qualify for assistance through VDHA’s Granting Freedom program. Granting Freedom provides grants of up to $6,000 to help military veterans make their homes more accessible.
  • Mortgage Credit Certificate: Available to first-time homebuyers only, mortgage credit certificates let you claim part of your interest on your taxes. You can claim a dollar-for-dollar credit of 20 percent of the interest you pay. The remaining 80 percent can be claimed as a tax deduction.

Current Mortgage Rates in Virginia

From your first home to the time you decide to get a refinance quote, it’s important to always compare various rates being offered. That can help you find the best lender for you. Unfortunately, mortgage rates can be a moving target. The economy isn’t stagnant, and neither are interest rates.

As lenders adjust their rates to meet the current environment, we’ll update the below rates, as well. This will help ensure you always get the best data about the Virginia lending scene.

Loan TypeCurrent Mortgage Rate
30-year fixed3.66%
15-year fixed3.17%
5/1 ARM (adjustable rate)3.86%

Closing a Mortgage

It takes time to close a loan for a purchase as large as a home.

Expect it to take at least 30 days. However, if you’re in a pinch, there are some lenders that can turn things around quickly. During that time, you’ll have to work in a home inspection, give the property owner time to repair any issues and provide all the documentation necessary to prove your income and employment status.

Here’s a sample of the average turnaround time for some of Virginia’s most popular lenders.

LenderAverage Days to Close Loan
Chase21
Alliant Credit Union45
Rocket Mortgage30
U.S. Bank44
SunTrust60

5 Best Mortgage Lenders in Virginia for First-Time Buyers

We’ve compiled a list of 5 of the best mortgage companies serving Virginia residents to help you with your search. These lenders are ideal if you need to buy a home for the first time.

1. Best Overall: Rocket Mortgage

Few things can beat the convenience of managing things online.

This holds true for a mortgage loan. Rocket Mortgage allows you to manage everything through its website. When closing day arrives, you choose the time and place.

It’s well worth getting a preapproval as you comparison shop because it’s so quick and easy to do.

2. Best for Fast Turnaround: Chase

Chase Mortgage is the lender to choose when you’re in a rush.

Chase’s closing process is faster than the average.

You can also choose to do things online, phone or in person.

3. Best for Help With Costs: BB&T

BB&T works directly with first-time homebuyers to find a way to reduce those initial costs.

That includes programs that eliminate mortgage insurance, as well as down payment requirements as low as 3%.

You may be required to take a course that will help as you move into your first home.

4. Best for FHA Loans: Prosperity Home Mortgage

FHA loans are especially popular with first-time homebuyers.

If this type of loan is on your radar, get in touch with Prosperity Home Mortgage.

Prosperity got its start in the Carolinas in 2006 and has spread to 44 different states. Prosperity offers low down payment conventional loans, FHA loans and VA loans to help you find the option that works with your needs.

5. Best for Government Employees: Virginia Credit Union

Virginia Credit Union may be the best choice if you’re employed by a state or local government agency.

This includes teachers, retirees and college students.

You’ll get competitive interest rates and homebuying resources to guide you through your first mortgage.

Your First Home in Virginia

Your first home purchase is something you’ll remember for the rest of your life. It’s important to find a lender that will give you a great experience and that fits your own preferences.

Frequently Asked Questions

1) Q: How do I get pre-approved?

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1) Q: How do I get pre-approved?
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First, you need to fill out an application and submit it to the lender of your choice. For the application you need 2 previous years of tax returns including your W-2’s, your pay stub for past month, 2 months worth of bank statements and the lender will run your credit report. Once the application is submitted and processed it takes anywhere from 2-7 days to be approved or denied. Check out our top lenders and lock in your rate today!

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2) Q: How much interest will I pay?

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2) Q: How much interest will I pay?
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Interest that you will pay is based on the interest rate that you received at the time of loan origination, how much you borrowed and the term of the loan. If you borrow $208,800 at 3.62% then over the course of a 30-year loan you will pay $133,793.14 in interest, assuming you make the monthly payment of $951.65. For a purchase mortgage rate get a quote here. If you are looking to refinance you can get started quickly here.

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3) Q: How much should I save for a down payment?

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3) Q: How much should I save for a down payment?
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Most lenders will recommend that you save at least 20% of the cost of the home for a down payment. It is wise to save at least 20% because the more you put down, the lower your monthly payment will be and ultimately you will save on interest costs as well. In the event that you are unable to save 20% there are several home buyer programs and assistance, especially for first-time buyers. Check out the lenders that specialize in making the home buying experience a breeze.

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