The 5 Best Mortgage Lenders

Top10.com StaffByTop10.com StaffOct. 24, 2019
Easily Compare Mortgage Lenders with Your Family
The American mortgage industry is extremely competitive, with around 12,000 institutions offering home loans at last count. With so much choice, it can be hard to know where to begin your mortgage comparison. But compare you must, because even seemingly small differences in rates and fees can have a big impact on your monthly payments or how much you’ll pay over the duration of the home loan.

We’ve reviewed the best mortgage lenders to make it easier for you to compare. Read on to find out who we’ve judged the 5 best mortgage companies.

1. LendingTree - Best Overall

  • Type of lender: Marketplace

  • Loan types: Conventional, Jumbo, FHA, VA, HEL/HELOC, Cash-Out Refinance

  • Loan terms: 10 to 30 years

  • Max. debt to income: 50%

  • Min. credit score: 500-620

  • Min. down payment: 0%-20%

LendingTree is a massive online loans marketplace that connects borrowers with the best rates on mortgages and other types of loans from its network of 350+ lenders. Because LendingTree is so big, it’s able to dig out the lowest possible rates for each user’s credit score and financial profile.

A major benefit to using this company is that it lets users pre-qualify for multiple lenders with one online form. The only real drawback is that it isn’t a direct lender, and users must complete their application directly with the mortgage provider they choose through LendingTree.

We judged LendingTree as the best overall mortgage lender because it lets users compare the lending market in minutes.

LendingTree LendingTree View Rates

2. Quicken Loans - Best for Purchase Loans

  • Type of lender: Direct

  • Loan types: Conventional, Jumbo, FHA, VA, Cash-Out Refinance

  • Loan terms: 15 to 30 years

  • Max. debt to income: 50%

  • Min. credit score: 500-620

  • Min. down payment: 0%-20%

Quicken Loans became the largest mortgage lender in the United States in late 2018, overtaking Wells Fargo. Quicken offers a full suite of loans, from fixed rate to adjustable, purchase to finance, and conventional to government-backed loans. It embraces all types of borrowers, from poor to excellent credit, from people with the means for a large down payment to those with no cash at all.

The number one reason to use this service is you can apply anyway you want. Every home buyer gets a choice of applying online or in branch, with full phone support. One thing Quicken lacks is home equity loans. If you’re looking to borrow against your home equity, you’ll need to look elsewhere.

Quicken is the best mortgage company for purchase loans thanks to its quick, streamlined, and professional application process. 

Quicken Loans Quicken Loans View Rates

3. Freedom Mortgage - Best for First-Time Buyers

  • Type of lender: Direct

  • Loan types: Conventional, Jumbo, FHA, VA, Cash-Out Refinance

  • Loan terms: 15 to 30 years

  • Max. debt to income: 45%

  • Min. credit score: 500-620

  • Min. down payment: 0%-20%

Freedom Mortgage is an experienced online mortgage lender offering a wide range of loans for purchase or refinance. Over the years, it has earned a reputation for specializing in government-backed loans such as VA loans and FHA loans. However, the reality is it offers a wide range of loans and minimum requirements to suit most borrowers.

One of the best things about this lender is the option of applying online. Although Freedom Mortgage maintains branches in 16 states, most customers choose to use its sleek online platform to do everything from requesting a quote to e-signing the final documents. One thing to be aware of: Freedom Mortgage doesn’t serve residents of New York, Nevada, Idaho, or Hawaii.

Freedom Mortgage offers hands-on customer service and a wealth of free tools and resources, making it a one of the best mortgage companies for first-time home buyers.

Freedom Mortgage Freedom Mortgage View Rates

4. Better Mortgage - Best for Refinancing

  • Type of lender: Direct

  • Loan types: Conventional, Jumbo

  • Loan terms: 15 to 30 years

  • Max. debt to income: 50%

  • Min. credit score: 620

  • Min. down payment: 0%-20%

Better Mortgage is one of the best of a new breed of digital mortgage lenders. By cutting out the bricks and mortar, Better Mortgage is able to approve mortgages more quickly and do it without charging any origination fees, loan officer commissions, application fees, or underwriting fees.

A highlight of Better Mortgage’s service is the rate lock feature. Once you’ve provided basic information about your property and income and authorized a hard credit query, Better lets you lock in your rate for a certain period of time. A couple of things to be aware of: Better doesn’t offer FHA or VA loans and it only operates in 31 states.

By not charging any origination fees, Better is able to offer market-beating closing costs on refinancing. 

View Rates

5. Figure - Best for Home Equity

  • Type of lender: Direct

  • Loan types: Home equity loan

  • Loan terms: 5 to 20 years

  • Max. loan to value: 80%

  • Min. credit score: 680

  • Min. down payment: N/A

Figure is a FinTech company that offers 2 unique HEL-style products: Figure Home Equity Loan Plus and Figure Home Advantage. It caters to homeowners in 37 states and DC, with more being added all the time. Homeowners may use Figure to borrow anywhere from $15,000 to $150,000 against their equity.

Figure Home Equity Loan Plus is like a combination between a home equity loan and home equity line of credit. The borrower gets the full value of their loan in a single lump sum and can make additional draws once they start paying off the loan. Figure Home Advantage offers all the same advantages as an FHA reverse mortgage, but without any age limit and with a higher upfront cash limit (92% of principal vs 60% for traditional reverse mortgages).

This unique offering makes Figure a solid option for anyone looking to borrow against their home equity.

View Rates

Compare the Best Mortgage Loans


Type of Lender
Loan Type
View

Marketplace

Purchase, Refinance, Home Equity

Direct

 Purchase, Refinance

Direct

 Purchase, Refinance

Better Mortgage

Direct

 Purchase, Refinance

View Rates

Figure

 Direct

 Home Equity

View Rates


How to Find the Best Mortgage Lender

Finding the right lender is an essential first step to finding the right home loan for your needs. Here are the main things to look out for when comparing the best mortgage companies:

  • Type of lender: There are marketplaces like LendingTree, direct lenders with online platforms and physical branches like Quicken Loans and Freedom Mortgage, and direct lenders that only operate online, such as Better Mortgage. Other types of lenders include traditional banks and credit unions. Each type of lender offers different pros and cons, so it’s important to know which category your chosen lender falls under.

  • Speed: A quick application process offers certainty and stability, while a slow process could make your home purchase more expensive or cause you to lose your bid altogether. Therefore, only go with lenders that have a reputation for quick service and short closing times.

  • Ease of use: These days, all the best mortgage lenders allow their customers to apply for home loans over the internet. Always compare lender websites and read lender reviews to understand which ones are easiest to use.

  • Reputation: With thousands of lenders in the mortgage market, it’s fair to say that some are open and transparent about their service and others are not. These days, all it takes to find out if a lender is trustworthy is to read reviews.

  • Customer service: For most people, taking out a mortgage is the biggest decision they’ll ever make in their lives. Therefore, home buyers deserve the absolute best customer service from their lender. All the mortgage lenders reviewed on this page are known for offering expert customer service, among other things.

How to Shop for a Mortgage

Now that you’ve made a shortlist of the best mortgage lenders, it’s time to compare how they perform on loan options. Here are the things to look out for when making your mortgage comparison.

  • APR

This is the annual percentage rate your lender collects for providing the mortgage, comprising interest rate and certain fees. The best lender for you is the one that can offer the best APR for your credit score, not the one that offers the lowest APRs in general.

  • Fees

In recent years, the best mortgage lenders have competed with each other to see who can offer greater discounts on things like origination fees and closing costs. If you’re taking out an adjustable-rate mortgage or think you might be able to pay off the loan early, check to make sure your lender doesn’t charge prepayment penalties.

  • Types of loans

If you have good credit, a conventional fixed-rate or adjustable-rate mortgage is probably best for you. But if you have poor credit or don’t have enough money for a 20% down payment, you may want to explore government-backed loans like FHA or VA loans. Not all lenders offer the exact same loan products, so shop around.

  • Terms

While rates and fees are important, it’s important not to neglect the terms because this can have a big impact on your monthly payments. The shorter your repayment term, the lower your total interest paid, but the larger your monthly payments. The longer your term, the more interest you’ll pay overall, but the less you’ll pay each month.

  • Minimum down payment

Most lenders require a 20% down payment for conventional loans. Occasionally lenders will accept less, although they may ask you to pay monthly private mortgage insurance until you reach 20% equity. 

How to Get the Best Mortgage Rate

Here are our top 5 tips for finding the best mortgage loan rates:

  1. Shop around: Make a mortgage comparison of at least 3-5 lenders to see how they all stack up against each other. 

  2. Improve your credit score: If poor credit is preventing you from getting decent rates, the good news is there are ways to repair your credit, e.g. paying off all your debts or taking out a small personal loan and paying it off quickly. 

  3. Have a history of employment: In addition to credit score, lenders look at a borrower’s overall financial profile including employment history. The longer you’ve been in a stable job, the better your chances of getting a good rate.

  4. Make a higher down payment: The more you pay down at the start, the less equity the lender will have in your new home and the lower the risk for the lender. In return for reducing the lender’s risk, you may be able to score yourself a better rate.

  5. Agree to an adjustable rate: Adjustable-rate mortgages, or ARMs, start with lower interest rates than fixed mortgages. However, they also carry more risk, because your rate can go up (or down) once the introductory period ends, whereas the rate on a fixed-rate loan stays the same for the duration of the mortgage.

Learn More About Home Loans

Always compare: that is the golden rule to finding the best mortgage. Every home buyer has their own requirements and credit history and what suits one borrower doesn’t necessarily suit another. Before settling on one provider, make sure to research the market and read reviews of the best mortgage lenders. Small differences between lenders mightn’t seem like a big deal, but they can make thousands of dollars’ worth of difference across the duration of your home loan. Spending time on a mortgage comparison now can save you in the long run.

Top10.com StaffByTop10.com StaffJun. 18, 2019
Our editorial staff is comprised of writers who are knowledgeable about financial services. We specialize in simplifying the process of choosing the right mortgage lender for your needs.