Best mortgage lenders | Fortune Recommends

Whether you’re a first-time homebuyer or you’ve done this before, we’ve compiled the best lenders on the market for a variety of situations. Let’s examine what each lender has to offer, where current interest rates stand, and how to decide which mortgage company is right for your needs. 

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6 best mortgage lenders of November 2024

Best overall: Rate Mortgage

With a wide variety of mortgage options and several programs meant to make homeownership more affordable, Rate Mortgage is our top pick. Plus, you might be able to get approved for a loan the same day you apply, making Rate a good option for those who need to move quickly.

What you should know about Rate Mortgage

Rate Mortgage, previously called Guaranteed Rate, offers loans in all 50 states. This lender offers an impressive array of loan options, from traditional conventional loans and government-backed loans to non-qualified mortgages—which don’t adhere to certain rules set by the Consumer Financial Protection Bureau, allowing them to be more flexible for people with irregular income—and physician loans.

Rate advertises a digital mortgage experience with 100% satisfaction guaranteed, or you’ll get $150 back. One of its signature programs is its same-day mortgages. You may be able to get a loan approved with just 3% down as early as the same day, with closing possible just 10 days later.

However, one potential concern to be aware of is that the lender ranks below average in J.D. Power’s 2023 Mortgage Origination Satisfaction Study.

Best if you want an impact lender: Movement Mortgage

When you want a lender with a wide variety of loan types, programs meant to help you afford the purchase, and the potential for approval even if your credit score isn’t quite at the preferred 620 level, Movement fits the bill. Plus, the company commits a notable portion of its profits to helping the communities it serves, meaning you can feel good about making your mortgage payment each month.

What you should know about Movement Mortgage

Movement Mortgage is a South Carolina-based lender that offers loans in all 50 states. Movement is what’s known as an impact lender—meaning it commits at least 10% of its profits to go toward local donations—and was founded in 2008 with the goal of making positive change, not only by helping homebuyers, but by helping communities too.

This company has a solid list of loan options, including some that may not always be available from competitors, such as USDA loans and Fannie Mae HomeReady loans. Plus, Movement Mortgage makes the shopping process easier by offering the possibility to to get a rate quote without having to apply and hurt your credit. And according to its website, it processes more than 75% of its loans in seven business days or less.

Movement Mortgage may also be a good option if the customer service experience with your lender is a key factor for you. It ranks highly in J.D. Power’s 2023 U.S. Mortgage Origination Satisfaction Study.

Best for first-time homebuyers: CrossCountry Mortgage

Purchasing a home can be daunting, especially if you’ve never done it before. CrossCountry can help out—both in terms of educational resources and with numerous programs aimed at helping first-time buyers afford a home.

What you should know about CrossCountry Mortgage

CrossCountry Mortgage is an Ohio-based mortgage lender with more than 600 branches nationwide, serving customers in all 50 states. CrossCountry has several features we like, including its free personalized rate quotes (though they require speaking with a loan officer) and its resources for first-time homebuyers.

Another feature worth mentioning is CrossCountry Mortgage’s FastTrack Credit Approval program. When you get preapproved for your CrossCountry loan, you can be cleared to close in as little as seven business days after you’ve made an offer on your home-to-be and signed the purchase contract. In fact, CrossCountry boasts a closing time of just 21 days on most of its loans.

CrossCountry Mortgage can also offer you a solid customer experience. The company ranks above average in two J.D. Power mortgage studies: the 2023 U.S. Mortgage Origination Satisfaction Study and Mortgage Servicer Satisfaction Study.

Best if you want a large lender: PennyMac

If you’ve got at least a 620 credit score and you think you’d feel more comfortable with one of the big players in the business, PennyMac might be the right lender for you. On its website, PennyMac claims the status of No. 6 home loan servicer in the United States, and No. 3 VA loan issuer/servicer too.

What you should know about PennyMac

PennyMac was founded in 2008 and today offers mortgages in all 50 states. Though it doesn’t feature as many loan types as some of its competitors, it is a good resource for conventional, FHA, and VA loans, as well as USDA Streamline Refinance loans.

Borrowers will likely appreciate PennyMac’s rate transparency, both in its displayed rates and its personalized rate tool. It also has some other attractive savings programs. For example, you could potentially qualify for 1% off your rate for the first year, $2,000 toward your refinance within three years, $1,000 as a bonus toward your closing costs, or between $250 and $9,000 cash back for connecting with a real estate agent through PennyMac.

Despite these pros, one con to be aware of is that PennyMac doesn’t have the best ratings in the J.D. Power surveys. The company ranks below average on both the mortgage origination and mortgage servicing lists.

Best for a lifetime loan servicer: New American Funding

What you should know about New American Funding

New American Funding is a California-based lender that was founded in 2003 and serves all 50 states. One of the first things that stands out is the lender’s variety of loan types. In addition to the more common loans, the company also offers interest-only loans, flexible mortgages they’ve dubbed “I CAN” loans with repayment terms ranging from eight to 30 years, and more.

New American Funding could also be a good option if you need help with your upfront loan costs. The lender offers up to $8,000 in down payment assistance, which can be used for closing costs and combined with other loan programs.

It’s worth noting New American Funding’s mixed customer satisfaction ratings per J.D. Power. The company ranks above average for mortgage servicer satisfaction but below average for mortgage origination satisfaction, according to the two 2023 surveys.

Best for a focus on the military: Veterans United Home Loans

What you should know about Veterans United Home Loans

Veterans United was founded in 2002, and by 2003 was focusing on the mission of helping military families attain homeownership through VA loans. The company makes the VA loan process easy to understand and offers services unique to the needs of military families.

First, Veterans United has 24/7 customer service so it can better serve military members serving overseas who may need help with their loans. It also offers free credit consulting to help borrowers boost their credit scores to have a better chance at qualifying for a mortgage. 

Finally, Veterans United has a higher mortgage origination satisfaction score than any other company in J.D. Power’s 2023 study (though it did not technically earn the top spot due to not meeting all the survey’s award criteria).

While Veterans United is a strong choice for military families who want VA loans, we don’t think it should be your first option for other loans. The company does offer other government-backed home loans and conventional mortgages—but it discloses very little information about its non-VA loans on its website. For other loan types, you may be better off working with a lender that specializes in them.

Current mortgage interest rates

When the Federal Reserve slashed the federal funds rate in an effort to stimulate the economy during the coronavirus pandemic, mortgage rates fell dramatically—with many homeowners landing rates between 2% and 3%. But then, to combat inflation, the Fed hiked the federal funds rate 11 times in 2022 and 2022, and mortgage interest rates surged accordingly. 

Eventually, mortgage rates began falling in the summer in anticipation of the Fed lowering the federal funds rate, which it did Sept. 18, 2024. But after the cut, mortgage rates actually started rising again. A key indicator economists have been watching is the 10-year Treasury yield, as that moves in tandem with mortgage rates about 85% of the time. And, per NBC reporting, the yield on 10-year Treasury notes rose in October to the highest level in three months.  

While mortgage interest rates fluctuate week to week and vary based on your lender and personal circumstances, you can get a good idea of current interest rates in the table below. These are average rates for a variety of home loan types according to mortgage data and technology company Optimal Blue.

How to choose the best mortgage lender for you

The mortgage lender you work with is one of the biggest decisions you’ll make when buying a home. It can affect all aspects of your loan, from your overall costs to the customer experience.

When you’re shopping around for a mortgage, it’s important to consider all aspects of each lender, including the types of loans they offer, what rate they offer you—and whether that rate is with or without paying for discount points—lender fees, and reputation, to name a few. For most borrowers, the interest rate ends up being a key factor.

How to shop around for the best mortgage rate

Your interest rate, after your actual loan balance, is the most important factor that determines your overall loan cost. Many lenders display rates on their website, and those can be a helpful guidepost in helping you identify who may have the lowest overall rates. However, those rates aren’t specific to you and your unique situation, so they aren’t necessarily representative of what you might get.

To get the most accurate rates, apply for preapproval from several lenders. While preapproval will typically result in a hard inquiry in your credit report, it’s more accurate than simply looking at the rates on a lender’s website, or even getting prequalified with a soft inquiry.

As you compare various loan offers, make sure to pay attention to more than just the interest rate. Also consider each lender’s closing costs and other fees. The annual percentage rate (APR) is more accurate than the interest rate since it encompasses both interest and fees.

When to consider a credit union mortgage

A credit union could be a good option to consider for your mortgage. In many ways, the mortgage experience of working with a credit union is no different from working with a traditional bank or online lender. They typically have similar application processes and loan types.

But credit unions can often have some advantages. Because they are nonprofit organizations, unlike banks, they may be able to offer lower loan rates and lower lender fees. They’re member-owned, so they may have loan costs and policies designed to favor borrowers.

You’ll have to be a member of a credit union to get a loan, and some may have restrictive membership. For example, some credit unions require that you live or work in a particular area or meet other specific requirements. That being said, there are plenty of credit unions that allow nearly anyone to join.

As you’re shopping for a mortgage, it’s certainly worth getting rate quotes from credit unions along with other lenders. And if you’re already a member of a credit union, that may be a good first top.

However, some credit unions may not have as up-to-date or streamlined of an online application form as larger banks and online-specific lenders. If convenience is a priority to you, this could influence your preference of which type of lender to apply with. 

Should you go through a mortgage broker?

A mortgage broker is a professional who can help you shop around for your mortgage. Unlike loan officers, mortgage brokers are independent entities—they don’t work for a particular lender. They can help you shop around with multiple lenders and compare offers.

Working with a mortgage broker has some definite benefits. You have someone shopping on your behalf rather than having to do the legwork yourself. Additionally, a broker may have relationships and resources that you don’t, which could possibly lead to you getting a better deal. 

However, working with a broker could be another cost, often as much as 1% or 2% of your loan amount. For example, if you’re buying a home worth $350,000, that might mean the mortgage broker’s commission could be between $3,500 and $7,000. Though this fee is sometimes covered by the lender, that’s not always the case.

Learn more: How much money you need to earn to afford a $400,000 home.

How to choose the best type of mortgage for you

When you’re comparing various mortgage options, it’s important to consider all aspects of your personal situation and finances. A few key factors that can help you choose the best type of mortgage include your credit score, down payment size, income, location, and whether you’re a veteran. Here’s a general guide to when each type of mortgage may be a good option:

• Conventional loan. These loans are the most common and are overall the best choice for many borrowers. Consider a conventional loan if you have a credit score of at least 620 and can afford a down payment of at least 3%.
• FHA loan. FHA loans have considerably lower credit score requirements than conventional loans (though individual lenders may have their own standards). You may consider this type of loan if your credit isn’t sufficient to qualify for a conventional loan.
• VA loans. VA loans are only available to current and former military members, and they’re a great option if you qualify for one. They have several perks, such as requiring no down payment and no private mortgage insurance.
• USDA loans. If you have a low or moderate income and want to purchase a home in an eligible rural area, a USDA loan might be a good option. These loans have strict eligibility standards, but allow the possibility of borrowing with no down payment.

As you’re comparing your loan options, make sure to also compare other loan characteristics, including loan term and interest rate type. Though 30-year fixed-rate loans are the most popular type of mortgage, they aren’t your only option. You could also consider a shorter loan term, such as 15 years, or an adjustable-rate mortgage (ARM). Just make sure to run the numbers to make sure whichever you choose is the best option both in the long run and for your monthly budget.

Learn more: Why one expert thinks the 40-year mortgage should become America’s new standard.

Why get a mortgage?

For most people, taking out a mortgage is the only feasible way to buy a home. The average home sale price in the United States was more than $500,000 as of the third quarter of 2024, according to data presented by the Federal Reserve Bank of St. Louis (FRED)—and most people simply can’t afford to pay that much out of pocket.

Learn more: How much you need to earn to afford a $500,000 home.

Mortgages have plenty of benefits, including long repayment terms—you can often pay off your loan over as many as 30 years. There’s also plenty of flexibility in mortgages, as there are a variety of loan and interest rate types to choose from.

There are also numerous programs to make mortgages even more accessible. These programs, including local government programs, nonprofit organizations, and federal government loan programs, can make mortgages more affordable and easier to qualify for.

Of course, homeownership isn’t right for everyone. But if you think buying a home may be in your future, it’s important to consider how mortgages work, their benefits, and what type of loan may work best for you.

Learn more: Should you buy or rent?

Factors that comprise a mortgage payment

The four basic components of a mortgage payment are known as PITI—short for principal, interest, taxes, and insurance.

• Principal: Your principal is the amount you actually borrowed. For example, if you buy a $250,000 home with $50,000 down, your principal is $200,000. Money toward principal will make up a small portion of your mortgage payments at first, but that will increase over time as you pay down your loan.
• Interest: The interest on your loan is the money you pay to the lender in exchange for borrowing money. Your monthly interest is based on your annual interest rate amortized over your loan. Interest makes up the bulk of your mortgage payment in the early years, but it will decrease over time.
• Taxes: In most places, you’ll have to pay property taxes on your home. While you may sometimes pay these yourself, your lender will often include your property taxes in your mortgage payment, hold it in an escrow account, and then pay it when it’s due.
• Insurance: Insurance refers to your homeowners insurance, which nearly all lenders require you to have on your home. You’ll pay one-twelfth of your homeowners insurance bill each month, and then the full balance will be paid when it’s due.

Depending on your situation, you may also have other expenses in your mortgage payment, including mortgage insurance or homeowners or condo owners association fees.

Glossary of mortgage terms you should know

• Adjustable-rate mortgage (ARM): An ARM is a type of mortgage that has a variable interest rate, meaning it can change periodically throughout the loan term on a set schedule.
• Amortization: Mortgage amortization refers to the schedule by which you pay off your mortgage over the entire loan term, usually 15 to 30 years. 
• Annual percentage rate (APR): Your loan’s APR refers to its total annual cost, including both interest and loan fees.
• Appraisal: An appraisal is an official valuation of your home, usually to help the mortgage lender determine the maximum loan amount.
• Biweekly mortgage payment: While most mortgage payments are made monthly, biweekly payments are those you make every other week (each one half of a full payment), adding up to 13 full payments over the course of a year.
• Broker: A mortgage broker is a third-party mortgage professional who isn’t affiliated with a specific lender and can help borrowers shop around for loans.
• Cash to close: Cash to close refers to the amount of money you have to pay when closing on a home, including both your down payment and closing costs. You’ll likely receive specific instructions on how to make this payment—for example, you might need to send the money by wire transfer or get a cashier’s check. 
• Closing costs: Closing costs are the fees and expenses (other than your down payment) that you’re responsible for at the time of closing, including origination fees, appraisal fees, title fees, and more. A good rule of thumb is to expect closing costs to run anywhere from 2% to 6% of the home purchase price.
• Closing disclosure: A Closing Disclosure is a five-page document your lender is required to provide you with leading up to your loan closing.
• Co-borrower: A co-borrower—which could also be a co-signer—is someone who is on your loan application with you and is also responsible for the loan payments.
• Conforming loan: A conforming loan is one that meets the loan requirements set by the Federal Housing Finance Agency, Fannie Mae, and Freddie Mac.
• Conventional loan: A conventional loan is any mortgage that’s not backed by a government program. Conventional loans can be conforming or non-conforming.
• Debt-to-income ratio (DTI): Your DTI refers to the portion of your gross income that goes toward debt payments, including your mortgage.
• Deed: A deed is a legal document that officially transfers ownership from the home seller to the buyer.
• Discount points: Discount points, also known as mortgage points, allow you to buy down the interest rate on your loan by paying a larger sum upfront.
• Down payment: Your down payment is a percentage of the home’s purchase price you pay at the time of closing, which gives you immediate equity in the home.
• Earnest money: An earnest money deposit is usually made when you go under contract on the home and is a show of good faith to the seller. The money ultimately goes toward your loan costs.
• Equity: Equity refers to your share of ownership in the home. The larger your down payment, the higher your initial equity.
• Escrow: Escrow is a type of account that holds money during the mortgage process. It’s often used to hold earnest money, and then later used for property taxes and insurance.
• FHA loan: An FHA home loan is a type of mortgage backed by the Federal Housing Administration. Such loans typically have lower credit score requirements than conventional loans, and may allow down payments as low as 3.5% of the home price.
• Fixed-rate mortgage: A fixed-rate mortgage is a loan that has the same interest rate, and, therefore, the same monthly mortgage payment, the entire loan term. (Though be aware factors such as increased homeowners insurance premiums or HOA dues can still cause your monthly housing payment to go up.)
• Foreclosure: Foreclosure is a legal process through which a lender takes ownership of a home if the borrower fails to make their mortgage payments.
• Homeowner’s insurance: Homeowners insurance is a type of property insurance required on most homes with mortgages. It pays for damage to your home and personal belongings in certain situations.
• Inspection: An inspection is a normal part of the homebuying process and is when a professional closely inspects the home to look for issues or needed repairs. As the homebuyer, when an inspection reveals notable issues, you may be able to negotiate with the seller to either make the repair or provide a credit that comes off your closing costs. 
• Interest rate: The interest rate is your annual cost of borrowing money from your mortgage lender.
• Jumbo loan: A jumbo loan is one that exceeds the conforming loan limits set by the Federal Housing Finance Agency.
• Lien: A lien gives another party a legal claim to your property. In the case of a mortgage, it gives your lender the right to foreclose on your home if you don’t make your payments.
• Loan estimate: A Loan Estimate is a three-page document lenders provide when you apply for a mortgage that outlines your expected loan terms and costs.
• Loan modification: Loan modification refers to a change in your loan terms, such as a change in your balance or amortization schedule.
• Loan term: The loan term is the total time over which you’ll repay it. Mortgage loan terms generally range from 15 to 30 years.
• Loan-to-value ratio (LTV): Your loan’s LTV is the percentage of the home value being financed—that is to say, how much you’re borrowing compared to the appraised value of the house.
• Mortgage: A mortgage is a legal agreement between a borrower and a lender where the lender agrees to finance a home purchase in exchange for monthly payments.
• Mortgage insurance: Mortgage insurance is sometimes required on loans and reduces the lender’s risk in providing the loan. Private mortgage insurance (PMI) is generally required on conventional loans when your down payment is less than 20%. On FHA loans, you’ll encounter a Mortgage Insurance Premium (MIP) instead.
• Origination fee: An origination fee is a fee that some lenders charge to process your application and loan.
• PITI: PITI, short for principal, interest, taxes, and insurance, refers to the four major components of a mortgage payment.
• Preapproval: Preapproval is when a lender confirms your loan eligibility without necessarily verifying all of your financial information. Think of it as a preliminary approval.
• Prepaid interest: Prepaid interest refers to the amount of interest you’ll owe on the closing day to pay the interest charges that accrue between then and your first loan payment.
• Principal: Your loan’s principal is the amount you borrowed that’s remaining on your loan. 
• Property taxes: Property taxes are taxes owed to your local government, which are often paid as a part of your mortgage payment.
• Rate lock: A rate lock is a feature offered by some lenders where you can lock in your rate for a period of time until you close on your loan. This can be particularly helpful in an environment where interest rates are increasing and you’re able to lock in a comparatively low rate. 
• Refinance: Refinancing your mortgage is when you take out an entirely new loan with a new term and interest rate to replace your existing mortgage.
• Right of rescission: The right of rescission allows you to back out of certain types of loans within three days.
• Title: A house title refers to ownership of the house. Rather than being a legal document, the title is simply a legal concept. Once you buy a home, you have the title.
• Title insurance: Title insurance protects you and/or your lender in case someone else has a legal claim to the title. Owner’s and lender’s title insurance are separate.
• Underwriting: Underwriting is the process your lender goes through to process and approve your loan application. 
• USDA loan: A USDA loan is backed by the U.S. Department of Agriculture and is available to low- and moderate-income borrowers in rural areas.
• VA loan: A VA loan is backed by the U.S. Department of Veterans Affairs and helps current and former military members finance their homes.

Our methodology

The Fortune Recommends team analyzed more than 30 financial institutions, including traditional banks, online lenders, and more, to come up with the top picks. Here are the key elements we considered:

• Available nationwide: We ranked lenders higher if they are licensed to operate in all 50 states. This doesn’t necessarily mean a lender has a physical branch in every state, but simply that customers throughout the U.S. can apply for mortgages with them.
• Variety of loans: Lenders scored higher if they offer both conventional mortgages and the three major types of government-backed mortgages—FHA loans, VA loans, and USDA loans.
• Public credit score requirements: Not all lenders publish minimum credit score requirements. Those who do—even if it’s only for a specific loan type—ranked higher on our list.
• First-time homebuyer assistance: The more assistance programs a lender offers to make homeownership accessible, such as low-down payment mortgage options or a credit to go toward closing costs, the higher it ranked in our methodology.

Frequently asked questions

What credit score do you need to get a mortgage?

To qualify for a conventional loan, the most popular type of mortgage, you’ll need a credit score of at least 620. You may qualify for an FHA loan with a credit score as low as 500 or 580, depending on your down payment. While other government-backed loans don’t have set minimum credit scores, lenders often require scores of at least 620 or 640.

Keep in mind that requirements may vary by lender, so just because you have a credit score of 620 doesn’t mean every lender will approve your loan. Additionally, having a credit score on the low end may result in a higher interest rate. Generally speaking, a credit score of 740 or higher is likely to land you the best mortgage rates.

Another thing to know is that the credit score you see when checking for free via a bank, credit card issuer or personal finance website probably isn’t the same as what mortgage lenders look at. The specific models generally used for mortgage lending are the Fico Score 2 (Experian/Fair Isaac Risk Model v2), FICO Score 5 (Equifax Beacon 5), and Fico Score 4 (TransUnion FICO Risk Score 04). To get those, you’ll need to purchase them through myfico.com.

How is my mortgage rate determined?

First, the mortgage rate you may be eligible for is determined by current industry-wide rates. These are determined in large part by the Federal Reserve’s current federal funds rate, as well as other economic factors. Your individual mortgage rate is based on several factors related to you and your mortgage, including your credit score, location, down payment, loan type and term, and interest rate type.

Will I have to pay for mortgage insurance?

Whether you have to pay for mortgage insurance depends on the type of loan you borrow and your down payment size. Conventional loans require private mortgage insurance when you have a down payment less than 20%. For example, if you purchase a $300,000 home, your down payment should be at least $60,000 to avoid PMI. 

All FHA loans, regardless of down payment size, require an upfront and annual mortgage insurance premium. However, your loan amount and down payment determine how long you’ll pay it. Finally, neither VA loans nor USDA loans require mortgage insurance, though USDA loans do require an annual guarantee fee.

What types of home loans am I eligible for?

The types of home loans you’re eligible for depend on several factors, including your credit score, down payment, home price, location, veteran status, and more. Conventional loans and FHA loans are the most accessible loans—you don’t have to meet any special requirements outside of the loan requirements. However, VA loans and USDA loans have more narrow eligibility relating to veteran status, location, and income. 

If you’re unsure what loan types you’re eligible for, consider sitting down with a mortgage broker or a loan officer at your local bank. They can review your situation and advise you on the best mortgage options. You may also find it helpful to seek guidance from a housing counselor approved by the U.S. Department of Housing and Urban Development (HUD). 

Do I really need 20% saved for a down payment?

The short answer is that no, you don’t need 20% saved for a down payment. You may qualify for a conventional loan with as little as 3% or 5% down or for an FHA loan with as little as 3.5% down (though for credit scores below 580, you’ll need 10% down). 

That being said, there are some clear benefits to a larger down payment. On a conventional loan, a down payment of 20% can help you avoid private mortgage insurance. Additionally, a higher down payment can often help you qualify for a better interest rate.

What assistance is available if I’m a first-time homebuyer?

There are a variety of programs available for first-time homebuyers (technically defined as anyone who hasn’t owned and occupied a home or occupied a home owned by a spouse within the past three years). These assistance programs, oftentimes offered by local governments or local housing organizations, may provide down payment and/or closing cost assistance in the form of loans (sometimes forgivable ones) and grants.

To find first-time homebuyer programs in your area, you might start with a quick internet search or visit HUD’s website and see what’s available in your state.

Can I roll closing costs into my mortgage?

You may be able to roll at least some of your closing costs into your mortgage, but it varies by lender. This is more common on refinance loans, but some lenders also allow it when you borrow your initial mortgage. Keep in mind that while this can save you money upfront, it will make those fees more expensive in the long run since you’ll end up paying interest on them.