CNBC Select rounded up five of the best mortgage lenders to help you streamline your search.
3&vtcrop=y" style="box-sizing: border-box; display: block; height: auto; width: 630px;" />The home-buying process is notoriously stressful and oftentimes confusing, especially if you’re taking on a mortgage to finance your purchase. There’s a lot to learn when it comes to the home loan application process, so CNBC Select rounded up a list of five of the best mortgage lenders to help you streamline the process and find a lender that best suits your needs. We evaluated home loan lenders based on the types of loans offered, customer support and minimum down payment amount, among others (see our methodology below.)
However, it’s important to keep a few things in mind when you’re looking to apply for a mortgage. First off, mortgage interest rates can fluctuate quite often — the rate you receive will heavily depend on your location, credit score and credit report. While you can take a look at each lender’s website to get an idea of what interest rates they charge, the best way to get a solid idea of what you will be charged is to provide the necessary information to check your rate.
Also, note that the mortgage approval and acceptance process comes with many fees, collectively called “lender fees.” Some lenders may waive certain fees or provide discounts on fees. It’s always a good idea to ask which fees have the potential to be waived but when you decide to move forward with a particular loan from a lender, prepare yourself to account for these additional charges.
It’s important to do your homework so you can be sure you’re choosing the lender that can suit your needs whether you’re a first-time homebuyer or purchasing an investment property. Homeownership comes with a learning curve, but we’ve included an FAQ section below to help you familiarize yourself with some aspects of the process.
The best mortgage lenders
- Best for lower credit scores: Rocket Mortgage
- Best for flexible down payment options: Chase Bank
- Best for no fees: Ally Bank
- Best for flexible loan options: PNC Bank
- Best for saving money: SoFi
Best for lower credit scores
Rocket Mortgage
Annual Percentage Rate (APR)
Apply online for personalized rates
Types of loans
Conventional loans, FHA loans, VA loans and Jumbo loans
Terms
8 – 29 years, including 15-year and 30-year terms
Credit needed
Typically requires a 620 credit score but will consider applicants with a 580 credit score as long as other eligibility criteria are met
Minimum down payment
3.5% if moving forward with an FHA loan
See our methodology, terms apply.
Who’s this for? Rocket Mortgage is one of the biggest U.S. mortgage lenders and has become a household name. Most mortgage lenders look for a minimum credit score of 620 but Rocket Mortgage accepts applicants with lower credit scores at 580 for some loan options.
The lender even has a program called the Fresh Start program that’s aimed at helping potential applicants boost their credit scores before applying. Keep in mind, though, that if you apply for a mortgage with a lower credit score, you may be subject to interest rates on the higher end of the lender’s APR range.
This lender offers conventional loans, FHA loans, VA loans and jumbo loans but not USDA loans, which means this lender may not be the most appealing for potential homebuyers who want to make a purchase with a 0% down payment for property in a rural area. Rocket Mortgage doesn’t offer construction loans (if you want to build a brand new custom home) or HELOCs, but if you’re a homebuyer who only plans to purchase a single-family home, a second home, or a condo that’s already on the market, this shouldn’t be a drawback for you.
This lender offers flexible loan repayment terms of up to 30 years.
Best for flexible down payment options
Chase Bank
Annual Percentage Rate (APR)
Apply online for personalized rates; fixed-rate and adjustable-rate mortgages included
Types of loans
Conventional loans, FHA loans, VA loans, DreaMaker℠ loans and Jumbo loans
Terms
10 – 30 years
Credit needed
620
Minimum down payment
3% if moving forward with a DreaMaker℠ loan
See our methodology, terms apply.
Who’s this for? Chase Bank provides several options for homebuyers who would prefer to make a lower down payment on their home. The traditional advice has been to make a down payment that’s about 20% of the price of the home, however, Chase offers a loan option called the DreaMaker loan that would allow homebuyers to make a down payment that’s as low as 3% (by comparison, the FHA loan requires borrowers to make a 3.5% down payment).
This option is made for those who can only afford a smaller down payment, but it also comes with stricter income requirements compared to their other loans (the annual income used to qualify the customer must not exceed 80% of the Area Median Income (AMI), according to the Chase team). If you meet the income requirements for the DreaMaker loan, this option could be very attractive for those who would prefer to make a down payment that’s as small as possible so they can have more money reserved for other homebuying expenses.
In addition to the DreaMaker loan, Chase also offers a conventional loan, FHA loan, VA loan and jumbo loan (USDA loans and HELOCs are not offered by this lender). Much like other lenders, Chase has a minimum credit score requirement of 620 for their mortgage options.
Chase offers mortgage terms that range from 10 years to 30 years, as well as fixed-rate and adjustable-rate mortgages (ARM). This lender also offers discounts for existing customers, but the requirements are rather high: For $500 off your mortgage processing fee, you need to have $150,000–$499,999 between Chase deposit accounts and Chase investment accounts; $500,000 or more in these accounts can get you up to $1,150 off the processing fee.
On top of this, Chase provides a number of resources to help their customers navigate the process and feel comfortable managing their mortgage, including online customer support, mortgage calculators and educational articles.
Best for no lender fees
Ally Home
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Annual Percentage Rate (APR)
Apply online for personalized rates; fixed-rate and adjustable-rate mortgages included
Types of loans
Conventional loans, HomeReady loan and Jumbo loans
Terms
15 – 30 years
Credit needed
620
Minimum down payment
3% if moving forward with a HomeReady loan
See our methodology, terms apply.
Who’s this for? It’s common for lenders to charge a number of fees on mortgage applications, including an application fee, origination fee, processing fee and underwriting fee — these fees can end up costing a significant amount during the home-buying process. tion-line: none;" target="_blank">Ally Bank doesn’t charge any of these fees (they may, however, charge an appraisal fee and recording fee, and may charge title search and insurance). You can get pre-approved for a loan in as little as three minutes online.
Ally offers a HomeReady mortgage program that is geared toward low- to mid-income homebuyers (regardless of whether it’s their first time or if they’re a repeat buyer) that would allow them to put down as little as 3% for a down payment. Applicants must also have a debt-to-income ratio of no more than 50%, their income must be equal to or less than 80% of the area’s median income and at least one borrower must take a homeowner education course.
In addition to this loan option, homebuyers can also apply for a jumbo loan (FHA loans, VA and USDA loans are not available through this lender). Customers can also choose between fixed-rate and adjustable-rate mortgages, and 15-year, 20-year and 30-year loan terms.
Best for flexible loan options
PNC Bank
Annual Percentage Rate (APR)
Apply online for personalized rates; fixed-rate and adjustable-rate mortgages included
Types of loans
Conventional loans, FHA loans, VA loans, USDA loans, jumbo loans, HELOCs, Community Loan and Medical Professional Loan
Terms
10 – 30 years
Credit needed
620
Minimum down payment
0% if moving forward with a USDA loan
See our methodology, terms apply.
Who’s this for? It’s sometimes tough to find lenders that offer USDA loans in addition to other standard mortgage options, but PNC Bank includes USDA loans in their lineup. This lender also offers conventional loans, FHA loans, VA loans, jumbo loans and a PNC Bank Community Loan, which is a special program that allows homebuyers to put down as little as 3% (without paying private mortgage insurance) while still choosing between fixed-rate and adjustable-rate mortgage terms.
This lender also offers a special loan option catered to medical professionals who are looking to buy a primary residence only. With this loan, medical professionals can apply for as much as $1 million and won’t have to pay private mortgage insurance (PMI), regardless of their down payment amount. They can also choose between fixed-rate and adjustable-rate terms.
PNC Bank offers online and in-person mortgage application processes, which can be a plus for homebuyers who don’t live near a PNC Bank location but still want to apply for a loan. You can get online prequalifications in as little as 30 minutes as long as you have all the documentation on hand and similar to most other lenders, PNC Bank has a minimum credit score requirement of 620.
Best for saving money
SoFi
Annual Percentage Rate (APR)
Apply online for personalized rates; fixed-rate and adjustable-rate mortgages included
Types of loans
Conventional loans, jumbo loans, HELOCs
"Features-styles-select-featureItemHeader--RA46g" style="box-sizing: border-box; font-size: 16px; margin-bottom: 2px; margin-top: 0px;">Terms
10 – 30 years
Credit needed
620
Minimum down payment
3%
See our methodology, terms apply.
Who’s this for? SoFi offers homebuyers a number of discounts that can help them save as much money as possible throughout their home-buying process. When you lock in a 30-year rate for a conventional loan, you can receive a 0.25% discount. And when you purchase a home through the SoFi Real Estate Center, which is powered by HomeStory, you can receive up to $9,500 in cash back.
This lender offers an online-only experience for those looking to qualify for a conventional loan, jumbo loan, or HELOC (SoFi doesn’t offer FHA, VA, or USDA mortgage loans). Terms range from 10 to 30 years and are both fixed and adjustable-rate. Similar to most other lenders, SoFi considers applicants with a minimum credit score of 620.
Homebuyers can also take advantage of a host of resources from SoFi, like a home affordability calculator, a mortgage calculator and a tor/" style="box-sizing: border-box; color: #0477c9; cursor: pointer; text-decoration-line: none;" target="_blank">home improvement cost calculator, which can really come in handy if you’re purchasing a home that needs some work done and you need to figure out ahead of time how much to budget for renovations.
Find the best personal loans
ticleBody-styles-select-subtitle--Ge5RH" style="box-sizing: border-box; color: #3e4855; flex-grow: 0; flex-shrink: 0; font-family: Lato, Helvetica, Arial, sans-serif; font-size: 30px; line-height: 34px; margin-bottom: 24px; margin-left: calc(11.1111% + 3.33333px); margin-right: unset; margin-top: 8px; max-width: 100%; min-width: unset;">Mortgage FAQs
What is pre-approval and how does it work?
Pre-approval is a statement or letter from a lender that details how much money you can borrow to purchase a home and what your interest rate might be. To get pre-approved, you may have to provide bank statements, pay stubs, tax forms and employment verification, to name a few. Once you’re pre-approved, you’ll receive a mortgage pre-approval letter, which you can use to begin viewing homes and start making offers. It’s best to get pre-approved at the start of your home-buying journey before you start looking at homes.
How do mortgages work?
A mortgage is a type of loan that you can use to purchase a home. It’s also an agreement between you and the lender that essentially says that you can purchase a home without paying for it in full upfront — you’ll just put some of the money down upfront (usually between 3% and 20% of the home price) and pay smaller, fixed equal monthly payments for a certain number of years plus interest.
For example, you probably can’t pay $400,000 for a home upfront, however, maybe you can afford to pay $30,000 upfront; a mortgage would allow you to make that $30,000 payment while a lender gives you a loan for $370,000 (the remaining amount) and you agree to repay that amount plus interest to the lender over the course of 15 or 30 years.
Keep in mind that if you choose to put down less than 20%, you’ll be subject to private mortgage insurance (PMI) payments in addition to your monthly mortgage payments. However, you can usually have the PMI waived after you’ve made enough payments to build 20% equity in your home.
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There are a variety of mortgage brokers out there offering an array of loan products for financing a home purchase. You can consider mortgages from credit unions, in-person banks and even an online lender. Because there are so many options, it can take some time to decide which financial institutions offer loans that are best fit for you.
There are also different kinds of mortgages you may qualify for, like conventional mortgages, which are not backed by any government programs. FHA loans, which are another type of mortgage, are one of the many government-backed loans borrowers can consider.
You can visit lender websites or jump on the phone with representatives to see if you’re a qualifying borrower and to get an idea of what loan estimates might suit your needs. You may also discuss whether fixed-rate mortgages or adjustable-rate mortgages are best for you, though, some lenders may only offer one or the other. Be sure to also inquire about any loan programs you may qualify for to help save some money.
Mortgage companies may also offer other products aimed at assisting you with homeownership. Some lenders also offer home equity lines of credit, which is a revolving credit line that is secured by your home and can be used for big expenses or debt consolidation. Refinancing is another popular loan product some homeowners inquire about, which can lower the interest rate of your current mortgage.
What is a conventional loan?
A conventional loan is a loan that’s funded by private lenders and sold to government enterprises like Fannie Mae and Freddie Mac. It’s the most common type of loan and some lenders may require a down payment as low as 3% or 5% for this loan.
What is an FHA loan?
A Federal Housing Administration loan (FHA loan) is a loan that typically allows you to purchase a home with looser requirements. For example, this type of loan may allow you to get approved with a lower credit score and applicants may be able to get away with a higher debt-to-income ratio. You typically only need a 3.5% down payment with an FHA loan.
