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Best Mortgage Lenders in January 2022

September 30, 2021

These days, there are many ways to get a mortgage, with countless traditional and online lenders offering various types of loans. You don’t want to enter a long-term financial commitment with the wrong company, and it’s important to choose the right lender for your circumstances. Each lender is different, and their product offerings can vary widely.

We tested dozens of online lenders to find the most trustworthy names on the market. Read on to find out what we discovered.

The Top Mortgage Lenders in January 2022

1. LendingTree

Services offered:
  • Home equity loans
  • Refinance mortgages
  • Fixed-rate loans
  • Adjustable-rate loans
  • Home equity line of credit
  • Reverse mortgage
  • FHA loans
  • VA loans
  • Cash-out refinance

LendingTree is an all-online loan marketplace. The user-friendly platform allows you to compare multiple mortgage offers from various lenders all in one place, rather than jumping from lender to lender on your own.

The biggest benefit of working with LendingTree is that it has an option for almost anyone, thanks to its extensive partnerships. Since it offers FHA and VA loans, you may even qualify with a credit score of 500 or a 3% down payment.

With over 25 years in business, LendingTree can work with you regardless of what state you live in. It can also help you get a mortgage in as little as 30 days.

Additionally, LendingTree makes the mortgage process incredibly easy. You’ll simply fill out some information online, and the site matches you with lenders that fit your needs. Comparing multiple lenders allows you to save money and get the best rates.

Keep in mind that LendingTree is not a direct lender. Once you choose a lender through the site, you’ll need to work with it directly to continue your application. LendingTree shares your basic personal information with potential lenders, so you may receive some sales calls. You can avoid those by getting on the Do Not Call list.

Find out more about LendingTree in our full-length review.

Compare Mortgage Offers on LendingTree

2. Credible

Services offered:
  • Fixed-rate loans
  • Adjustable-rate loans
  • 10, 15, 20, and 30-year mortgages
  • FHA loans
  • VA loans
  • Jumbo loans
  • Cash-out refinance

As a company that prides itself on being ethical, Credible is an online loan marketplace that works for consumers. It does not sell your data and aims to be as transparent as possible.

When you enter basic information, like your location and desired loan amount, you’ll receive accurate prequalified rates ‒ not just ballpark numbers ‒ from multiple lenders. The entire process takes about 3 minutes and allows you to compare multiple mortgage loan offers in one place.

In a booming housing market, speed is key to getting the house of your dreams. Credible provides accurate rates based on a soft credit check, so you know exactly what your budget is. It also provides a preapproval letter, which you can use to support an offer on a home.

Credible’s online platform is intuitive, which allows it to provide results quickly. It has an automated document upload process to speed up the process even more. You complete the entire loan origination process through Credible, from comparing rates to closing on the loan. Plus, Credible’s loan officers don’t earn commission, so there’s no upselling.

Credible is fairly new, having been in business for 8 years. While it does allow you to compare up to 8 lenders at one time, it doesn’t have the huge network of lenders that other loan marketplaces can offer. However, this doesn’t seem to affect most customers as Credible has a 4.7/5 star score on TrustPilot.

Learn more in our in-depth Credible review.

Compare Mortgage Loan Offers on Credible

3. Quicken Loans

Services offered:
  • Fixed-rate loans
  • Adjustable-rate loans
  • FHA loans
  • VA loans
  • Jumbo loans
  • Refinance
  • Cash-out refinance

Quicken Loans, also known as Rocket Mortgage, is one of the largest mortgage lenders in America. Its all-online service means that you can apply and get an approval within just 10 minutes. If you can put at least 3% down and have a credit score of at least 620, Quicken Loans could be a good choice for you.

One of the biggest benefits of working with Quicken Loans is its YOURgage offering, which allows you to choose a loan term between 8 and 29 years. This also puts more power in your hands, allowing you to customize your mortgage to your unique budget and influence how much your monthly payments will be.

Quicken Loans has an easy-to-follow online application process that allows you to upload documents and track your progress. It has an excellent reputation for customer service through the Better Business Bureau, TrustPilot, and J.D. Power. It also offers extensive customer service hours, so you can easily get assistance through live chat, email, or phone call.

Quicken Loans doesn’t offer home equity loans or home equity lines of credit. It also doesn’t have the lowest rates, so you may find lower interest rates and APRs with other lenders. However, it does make the complicated mortgage process easy to understand, with live support available at most times of the day should you need it.

For more information, see our expert Quicken Loans review.

See Mortgage Loan Offers on Quicken Loans

4. Better Mortgage

Services offered:
  • Conventional loans
  • Fixed-rate loans
  • Adjustable-rate loans
  • FHA loans
  • Jumbo loans

Better is an online mortgage lender that is backed by big names like Ally, American Express, Citi Bank, and Goldman Sachs. It was built to be an all-online experience from day one, so the website and application process are extremely user-friendly. You can receive a personalized rate quote in under 5 seconds and a pre-approval in under 3 minutes.

Better requires no lender fees ‒ that means you pay no application, origination, processing, or underwriting fees. It employs loan officers who don’t work on commission, so you can save money and are never pushed into a sale by a commission-focused salesperson. Better’s team is there to support you throughout the process rather than sell you a bigger loan.

Better doesn’t offer VA, USDA, home equity, home equity line of credit, or land loans. It also doesn’t offer loans for foreclosures. However, by narrowing its offering, Better can serve most standard mortgages more quickly and efficiently. You can get a preapproval letter in as fast as 24 hours, which can mean the difference between getting your dream home and missing out.

See all the details in our in-depth Better Mortgage review.

See Mortgage Loan Offers on Better Mortgage


What Is a Mortgage?

Mortgages are types of loans that you use to purchase or refinance a home. You can get a mortgage from a bank, online lender, or other investors. When you get a mortgage, the home may be used to pay off your lender if you fail to pay them back. This makes a mortgage a type of secured loan, or a loan that you can back with collateral.

When you have a mortgage, you’ll make monthly payments, typically over a 15 or 30 year period. You’ll also pay interest on the loan value.

While you pay off your loan, you only own as much as you’ve paid into the down payment and towards your loan. Your lender owns the rest of the home’s value. When the loan is completely paid off, the lender releases the lien on the home and it is officially yours.

Compare Mortgage Loan Offers on LendingTree

Types of Mortgage Loans

There are many types of mortgage loans available. Each type caters to a different set of financial circumstances. Understanding the different types of loans can help you choose the right mortgage loan for you.

Conventional Mortgages

Conventional loans, or conventional mortgages, are funded by private lenders and are not backed by the federal government. This is the most common type of mortgage. You typically need a credit score of at least 620 and a down payment of at least 3% of the purchase price.

If you put down less than 20% on a conventional loan, you will need to buy private mortgage insurance (PMI). PMI adds to your monthly costs and protects the lender if you are unable to repay the loan. While it can make your overall costs higher, it allows you to get a loan sooner than if you had to spend years saving for a larger down payment.

Conforming Loans

Conforming loans are a type of conventional loan. They adhere to funding criteria set out by Freddie Mac and Fannie Mae, as well as the Federal Housing Finance Agency’s dollar limit. These loans must stay below a certain dollar limit which changes each year. This year, that limit is $548,250 in most of America, but it can be higher in more expensive cities.

Conforming loans must also meet the following Freddie Mac and Fannie Mae guidelines:

  • A maximum loan-to-value (LTV) ratio of 97%. The LTV ratio is the mortgage amount divided by the appraised property value.
  • A down payment of at least 3%.
  • A debt-to-income (DTI) ratio of 50% of less. The DTI ratio is the total of your monthly debt payments divided by your gross monthly income.
  • Credit score and history, with a minimum credit score of 620.

These loans come with low interest rates if you have excellent credit. Lenders like providing conforming loans as they can package and sell them in the secondary mortgage market, which is why you can get a lower interest rate.

Compare Mortgage Loan Offers on Credible

Nonconforming Loans

Nonconforming loans do not meet Freddie Mac and Fannie Mae’s purchase criteria. Since these loans cannot be sold on the secondary mortgage market, they typically require higher interest rates.

Loans that fall into this category may be nonconforming due to their loan size or your financial information, including credit score, credit history, loan-to-value ratio, or loan-to-income ratio.

Fixed-Rate Mortgages

With a fixed-rate mortgage, your monthly payments and interest rates stay the same for the life of the loan. You’ll be able to easily budget this type of loan into your monthly expenses, however, you won’t get to take advantage of low interest rates if the market falls.

Adjustable-Rate Mortgages

The opposite of fixed-rate mortgages, adjustable-rate mortgages have payments and interest rates that can fluctuate up and down throughout the life of the loan. These mortgages have lower payments and rates at the start of the loan, but can drastically change later on.

FHA Loans

The Federal Housing Administration (FHA) backs FHA loans, which means that the government reimburses lenders if you fail to pay off the loan. Since this presents less risk to lenders, you can get a loan with minimal requirements, including a credit score of 580 and a down payment of just 3.5%.

FHA loans do come with an extra set of requirements. You must live on the property for at least one year after purchase. You also have to get a special FHA-approved appraisal and an inspection that determines if the property meets FHA’s minimum property standards.

See Mortgage Loan Offers on Quicken Loans

VA Loans

Similar to FHA loans, the government backs VA loans. The Department of Veterans Affairs (VA) provides certain guarantees to private lenders for qualified veterans, service members, and surviving spouses.

Since the VA backs these loans, lenders are more likely to offer you a loan, even if you present more risk. You can get a VA loan if you meet the above qualifications and have a credit score of at least 580. You can put as little as 0% down with no PMI.

USDA Loans

USDA loans are available for homes in specific rural areas and allow you to put as little as 0% down. To qualify, your household income must be 115% or less than the median income in the area. USDA loans are particularly useful in cases where the USDA guarantee fees cost less than FHA mortgage insurance. In other cases, FHA loans may be a better deal.

Balloon Mortgages

If you plan to refinance or sell within 5 to 10 years, a balloon mortgage may be best for you. This type of loan requires interest payments for a term of 5 to 10 years before a lump sum payment is due. This type of loan allows you to make a lower monthly payment than with a conventional loan, but requires you to pay a lump sum, refinance, or sell by the end of the loan.

Compare Mortgage Loan Offers on Credible

How Does the Mortgage Loan Process Work?

If you’re looking to buy a house soon, it’s important to start the mortgage loan process early. The process can take a decent amount of time, but kicking it off early will allow you to act quickly when you find a home that you love.

The process looks like this:

  1. Get Preapproved

It’s important to get preapproved before looking for homes, as this shows your realtor and home sellers that you’re serious. It also ensures that you’re only shopping for homes within your budget.

Shop around for a lender that fits your needs, or compare multiple offers on a site like Credible. Then, apply for preapproval. The lender will provide you with a preapproval letter that shows that you’ve been vetted and you’ve proven your eligibility for the loan amount.

With Better Mortgage, you can get a preapproval letter in as little as 24 hours.

  1. Shop Around and Make an Offer

In this part of the process, you’ll visit houses and look for your dream home. Once you’ve found it, make an offer and submit your earnest money deposit. The earnest money deposit can secure your offer on the house by showing the sellers that you’re serious.

The amount will vary and your real estate agent will guide you depending on the home. It can be anywhere from $500 to 5% of the purchase price.

  1. Home Inspection

If the sellers accept your offer, you’ll need a home inspection to check for any issues that you can’t see on the surface. A specialist will review the home’s foundation, structure, roofing, plumbing, and electrical. The results of the inspection may play a role in negotiations.

  1. Submit Your Mortgage Application

If you’re going with the lender that preapproved you, you’ll complete your mortgage application and receive a loan estimate. The loan estimate will include your monthly payment, estimated interest rate, and closing costs. If they haven’t already, at this point your lender verifies your financial details and property information.

If you want to shop around for a lender, the process looks the same, you’ll just need to search for a new lender that fits your needs. At this point, you’ll also want to purchase homeowners insurance, which lenders require for your loan to be approved.

You can compare mortgage loan offers from multiple lenders on LendingTree.
  1. Home Appraisal

Next, your lender arranges an appraisal for an independent estimate of the home’s value. This is typically done by a third-party company to ensure you’re getting a fair price. If the home doesn’t appraise for the purchase price, your lender will not approve your loan.

  1. Processing and Underwriting

At this point, you play the waiting game while the loan processor and underwriter do their work. This involves pulling credit reports, tax transcripts, and title searches. The processor will verify your bank deposits and payment history before sending all of the documentation to the underwriter.

The underwriter then reviews the information, ensuring that nothing is missing and there are no issues with your capacity to pay the loan, credit history, or collateral.

  1. Close

Finally, you close on the loan by reviewing the closing disclosure. You’ll have at least three days to review all the mortgage documents and compare them for accuracy against the loan estimate your lender provided earlier in the process. You’ll pay your down payment and closing costs and sign all necessary documents.

See Mortgage Loan Offers on Quicken Loans

How to Apply for a Mortgage

Applying for a mortgage is fairly simple nowadays, with most lenders offering an online application process. Before starting, you should do the following:

  • Know your credit score. Your credit history and credit score will play a major factor in your approval, with most lenders requiring a score of at least 620. If your score is lower than 620, consider taking some time to improve it. You can also shop around for a loan that doesn’t require such a high score, such as an FHA loan.
  • Understand which loan type is right for you. Most online lenders can help steer you to the right type of loan if you need help, but understanding the different types of loans and their requirements ahead of time will speed up the process for you.
  • Have documents ready. You’ll need your tax returns, bank account statements, and pay stubs in order to apply for a mortgage.

Once you’re ready, apply to several lenders to compare options and determine the best lender for you. Sites like LendingTree and Credible can save you a lot of time and effort by allowing you to compare multiple lenders on one convenient platform. Be sure to apply to all the lenders you’re interested in working with within a 45 day period, as this will protect your credit score. You may also consider using a loan marketplace, like LendingTree, to easily prequalify with and compare lenders on one platform.

Next, you’ll compare offers and choose a lender. Evaluate the offers by comparing monthly payments, interest rates, closing costs, and terms. Choose the best option and complete the process by providing any additional documentation requested and answering any questions that may arise about your financial history.

You may need to provide documentation on:

  • Proof of income, including W2s, tax returns, and pay stubs
  • Proof of assets, including 401K, savings, and checking statements
  • Personal documentation, including a government-issued ID, letters of explanation for various abnormal situations, divorce decrees, and business licenses

Finally, you’ll close on the loan after receiving the closing disclosure, which includes the final costs. At this point, you can expect to sign lots of documents and pay the down payment and closing costs.

Compare Mortgage Loan Offers on Credible

How Is Your Mortgage Interest Rate Determined?

Lenders determine mortgage interest rates by considering economic conditions, the home you want to buy, the loan you’re getting, and your risk level as a borrower. Lenders will consider your credit history, down payment amount, interest rate type, home price, loan term, property type, and market rates to set your mortgage interest rate.

Beyond the personal factors that go into your interest rate, your rate will also vary depending on which type of loan you choose. Mortgage interest rates can be either fixed or adjustable. In either case, the interest rate represents the annual cost of financing your home and is a percentage of the loan amount.

With fixed interest rates, you’ll have the same interest rate for the duration of the loan term. That means that your monthly payments will be the same, which can make budgeting easier. While you won’t have to worry about rising costs, you also can’t get a lower rate unless you choose to refinance. So, if you have a 3% interest rate and a 15-year loan, you’ll pay 3% until the loan is paid off or until you refinance.

Adjustable-rate mortgages start with a fixed interest rate period, at the end of which your interest rates are subject to change depending on the market. Most fixed interest rate periods are 5, 7, or 10 years. When that period ends, every 6 months to a year, your interest rate can fluctuate up or down.

Adjustable-rate mortgages are beneficial because they sometimes offer lower interest rates than you’d get with a fixed-rate loan. This type of mortgage is best if you plan to refinance or move before the end of the fixed-interest rate period.

See Mortgage Loan Offers on Better Mortgage

How to Choose the Right Type of Mortgage for You

Since there are so many types of mortgage loans, it’s important to weigh the pros and cons of each type as they relate to your circumstances. Consider these key factors:

  • Credit Score: Most mortgages require a credit score of at least 620, while some specialty loans can accept credit scores as low as 500.
  • Minimum Down Payment: The more you can put down, the lower the interest rate you can qualify for. Some products require a down payment of 10% while others only require 3%.
  • Term: Terms can range from 10- and 30-year fixed-rate mortgages, down to 5/1 and 10/1 adjustable-rate mortgages. While a 10- or 30-year fixed-rate mortgage has the same interest rate for the entire term, a 5/1 adjustable-rate mortgage will have a set interest rate for the first 5 years and an adjustable rate after that period. In 5/1, the 5 refers to the number of years that you have a fixed rate, while the 1 refers to how often your interest rate can adjust after the fixed-rate term – in this case, once per year.
  • Debt-to-Income Ratio: Also known as your DTI, some loans require a lower rate than others. Take this into account when choosing a mortgage.
  • Private Mortgage Insurance: Depending on your loan type and down payment, your lender may require that you buy private mortgage insurance. In most cases, if you put down less than 20%, you can expect this additional expense.

Compare Mortgage Loan Offers on LendingTree

How to Choose the Right Mortgage Lender

Mortgage lenders can vary widely, from product offering to costs. Consider the following to choose the right mortgage lender for you:

  • Availability: Not all lenders are licensed in every state, and each lender has a different offering. Make sure they have the type of loan that you want and are able to service your location.
  • Interest Rates: Choosing the best interest rate is what will likely save you the most money over time, so compare interest rates between lenders and types of loans to find the best deal.
  • APRs: The APR includes closing costs and interest rates, so it gives you an overall idea of your costs. Closing costs can be 2% to 5% of the loan amount, which can be a big chunk of change. The closing costs include application, appraisal, and origination fees.
  • Lender Reviews: Although this won’t save you money, it can save you a lot of headaches. Checking out lender reviews will give you some insight into what to expect with the lender. You may not want to enter into a 30-year loan term with a lender that is notorious for bad service. Look at your potential lender’s ratings on Better Business Bureau and TrustPilot to get a feel for their customer satisfaction. Just be sure to take reviews with a grain of salt, as it’s human nature to share feedback when there’s a problem rather than when things are going well.

What Can You Do If You Can’t Make Your Mortgage Payments?

If you’re in a position where you can no longer make your mortgage payments, it’s important that you act fast to avoid foreclosure. First, call your mortgage lender and ask what options your specific lender and type of loan can offer in this situation. You can find the phone number on your mortgage statement, in the mortgage loan coupon book, or online.

Your lender will ask you to provide more information on why you can’t make your payment and if the situation is ongoing. They’ll want to know financial information, like what you have saved in the bank, what money you’re receiving through income, and what bills you have that are taking up that income. Your mortgage lender should want to help you avoid foreclosure and will work with you to work through your specific circumstances.

Generally speaking, your lender may offer the following options:

  • Loan modification
  • Repayment plan
  • Refinance
  • Forbearance

You can also call a housing counselor to guide you through the process and help you avoid foreclosure. Make sure to get a HUD-approved housing counselor through the Department of Housing and Urban Development. They’ll work with you to:

  • Discuss any programs that may be available based on your situation
  • Explain loss mitigation options that your lender provides
  • Help you with any paperwork or questions
  • Assist with budgeting, debt, or financial issues that are causing your inability to pay your mortgage

You may want to consult an attorney if you’ve been served with legal papers or if things have progressed to foreclosure.

FAQ

Which mortgage lender is the best?

The best mortgage lender will depend on your desired type of loan and financial circumstances. Mortgage lenders offer a variety of services and types of loans. The requirements for approval also vary from lender to lender. The best lender is one that offers the loan type you need, has the lowest rates and fees, and has requirements you can meet. You can compare multiple lenders on sites like LendingTree or Credible.

How can you get the lowest mortgage rate?

Mortgage rates depend on your financial circumstances, including credit score, down payment amount, loan type, and loan term. You can find estimated mortgage rates on lenders’ websites, but you’ll need to get preapproved to get a custom offer for your financial circumstances.

How is your mortgage interest rate determined?

Mortgage interest rates are determined based on your finances and the current economic conditions. This information tells the lender what level of risk you impose, which determines the interest rate. The financial information they consider includes your credit history, home price, down payment amount, loan term, interest rate type, market rates, and property type.

What documents do you need to apply for a mortgage?

You’ll need tax returns, pay stubs, and bank account statements to apply for a mortgage. You’ll also need documentation on any assets and debts, credit history, rental history, and identification.