Buying a home is a long term commitment. When you do so, you’re most likely going to have a mortgage for many years, one should look around for a great home loan lender. To do that, you want to shop around for offers from a few different lenders.
You’ll need to compare mortgage rates as well as other loan terms such as customer service offerings, the availability of online loan tracking and application process, time to close, and total loan amount. Taking the time to browse around can save thousands of dollars throughout the loan.
Before you house shop, you should still get preapproved. You want to check your credit score and make sure your credit history is accurate before you take the plunge. To help you find a home loan lender for you, we’ve selected some based on their fees, terms, and mortgage rates. So continue reading, and we’ll walk you through everything you need to know about finding the best mortgage lenders for you in 2020.
Quicken Loans is a well-known home loan lender with widespread TV and online advertising campaigns that tout the benefits of its signature Rocket Mortgage product. According to 2019 data, Quicken Loans is the largest loan originator and originated more than $140 billion in mortgages for that year. They surpassed their previous record of $96 billion, which was set in 2016.
There’s a reason why Quicken Loans is one of the biggest home loan lenders around. They make applying through this mortgage company online very easy for the consumer, and they are also available nationwide. Plus, they offer attractive rates, which helps them to solidify their position at the top.
Their online lending application is particularly attractive because it doesn’t come with the same red tape that a lot of traditional home loan lenders require. For example, there’s not much physical paper involved, and you don’t have to type in all of your accounts. Most of that stuff happens automatically with Quicken Loans when you connect your bank accounts. The process of filling out the application is fast and straightforward, which is appealing to some customers.
Social Finance, or SoFi for short, began as a student loan refinancing company. Quickly, the business grew into other loan products of personal finance, home loans included. This lender also looks into more than just your credit score when it comes to lending. They also include considerations like earning potential and valuable college degrees.
To begin the lending process at SoFi, you must first go through a prequalification that takes only a few minutes to complete and doesn’t impact your credit score. From that point, you can pick the loan you want and finish all of your paperwork. Like traditional loans, it generally takes around thirty days to complete the mortgage application and get funded by the lender.
This lender offers 15-year and 30-year fixed loans. They also offer 5/1 interest-only ARM and 7/1 ARM loans. SoFi doesn’t lend for most investment properties, and they mainly focus on owner-occupied first and second houses.
For members, the origination fee at SoFi is $500. For non-members, it will cost $1,000.
If you’re looking for refinancing, then you should consider LoanDepot. They make the whole refinance process smooth and straightforward. This lender is so famous for refinancing, in fact, that it has funded billions of dollars worth of mortgage loan refinancing.
They also reimburse appraisal fees and waive refinance costs for all future refinances after the first time you refinance with LoanDepot.
There are a variety of reasons to consider a refinance – whether it’s because you want to pull out cash for an upgrade, have a more expensive home, more income, or have better credit. So long as it’s going to save you money in the long run, it’s typically not a bad idea to refinance at a lower interest rate.
New American Funding
If you have a low credit score and find yourself self-employed, you should consider using the services from New American Funding. That’s because New American Funding looks at every application they get manually before they deny or approve a loan.
Since every loan is reviewed manually, loan officers might look at other factors, such as high-income and good savings. No matter the state of your finances, New American Funding requires that an applicant have a minimum of a 620 credit score to get approved.
After you get approved, you should be able to improve your credit score by paying your mortgage on-time every month. As time goes on, you might achieve a credit score that’s high enough to refinance your loan at a lower interest rate.
Reali (Formerly Lenda)
Reali is another popular member of the online based home loan industry. They offer an easy and fast prequalification process and also provide quick refinancing estimates through their website. However, they thankfully don’t provide their customer service exclusively through the Web.
Reali has a concierge service that can help you through the lending process from beginning to end. The process is paperless and transparent. Anyone who is even a little tech-savvy will feel both familiar and comfortable doing this.
One of the most frustrating parts of mortgage borrowing is all of the paperwork and finding missing documents to give to the lender. The digital system that Reali provides makes it clear about what you have to send in. They also offer updates to what you’re missing, so you won’t have your funding or approval held up due to a misplaced document or form.
Bank of America
Being one of the biggest banks in the world certainly comes with some advantages that other institutions can’t afford, especially when it comes to mortgage lending. Bank of America offers multiple loan options and high-tech customer service.
Bank of America offers many options of refinancing and purchase loans, including adjustable-rate mortgages with 5/1, 7/1, 10/1, and 15-, 20- and 30-year fixed-rate loans. It also issues government-insured mortgage products such as Veterans Affairs (VA) and Federal Housing Administration (FHA) loans plus jumbo loans up to $5 million.
Bank of America also has multiple programs that are meant to make homeownership more affordable for first-time and lower-income homebuyers.
These programs include:
- Up to $7,500 in lender credit for expenses like recording fees and title insurance
- Up to $10,000 in closing cost and down payment assistance
- Two mortgage products with 3% minimum down payments: the Freddie Mac Home Possible mortgage and the Affordable Loan Solution mortgage
The digital mortgage experience from Bank of America allows you to apply, get prequalified, and also lock in your interest rate online through its mobile app or website. You might even be able to get preapproved on the same day that you apply. If you’re a Bank of America customers already, then your financial data and contact information will auto-populate on the digital application, thus saving you time. You can also apply in-person or over the phone if that’s something you would prefer. The Home Loan Navigator portal from Bank of America helps you stay plugged in throughout the borrowing process.
You can make lower payments every month with an interest-only loan than with a conventional, traditional loan. But to get that lower payment, you don’t make any progress in paying off the principal and building equity in your house. Because of this, interest-only loans usually aren’t the ideal option.
If you want to apply for an interest-only mortgage, you should check out Guaranteed Rate. This home loan lender has exceptionally high customer satisfaction and offers interest-only mortgages in all 50 states and Washington, D.C. Just make sure that you’re aware of the downsides of interest-only loans before you apply for one.
Busey Bank is a big mortgage lender based in Saint Louis, Missouri. This bank delivers traditional Midwest business pride along with their award-winning customer service rankings. It also has offices in Illinois, Missouri, Florida, and Indiana.
Busey may not be the biggest lender out there, but they offer a variety of adjustable and fixed loans as well as loans through the VA and FHA mortgage loan programs. The history of Busey bank dates back to 1868, making it one of the longest existing lenders on this list.
Even though PennyMac isn’t related to the large lenders Fannie Mae and Freddie Mac, it’s still a name you should probably know if you’re looking for an FHA loan with a low down payment. PennyMac is a direct lender, and they are mainly an online-focused lending institution.
PennyMac offers a range of loans, including traditional, jumbo, USDA, VA, and FHA loans. For people who have a low down payment, especially first-time homebuyers, you might find a better experience and excellent rates with this West Coast-based lender.
Navy Federal Credit Union
Navy Federal is ideal for members of the military and their families. Credit union members can select a wide range of refinancing and purchase loans, including mortgages with low or no down payment requirements.
For families who have to relocate every couple of years, Navy Federal’s various adjustable-rate loan options can be especially useful. There are two cornerstone loans geared to military members and their families from Navy Federal: the Military Choice Mortgage and the HomeBuyers Choice Mortgage.
The HomeBuyers Choice program is for first-time home buyers. This program offers fixed-rate loans of 15 or 30 years with no mortgage insurance premiums and up to 100% financing. According to the lender, the Military Choice program has the same benefits as the HomeBuyers Choice. It has special pricing on origination fees and mortgage interest rates for veteran and active-duty borrowers.
The Importance of Knowing About the Best Home Loan Lenders
As we can see, there are a lot of different mortgage lenders out there. By expanding your knowledge base of the various lenders available to you, you can make more informed decisions about your financial future and find the best home loan lender for you.