Best mortgage lenders 2022

Best mortgage lenders 2022
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The best mortgage lenders will be able to help first time buyers and home-movers source their ideal home loan, giving them the funds they need to buy that all-important property – and with mortgage rates having hovered around record low levels for much of the last year, there are still some great deals to be found. 

Those with bad credit needn’t miss out, either, with mortgages specifically designed for those with bad credit available, albeit with higher rates and less appealing terms. Yet the lowest rates will always be reserved for those with the highest credit scores, so if yours is currently lacking, it could be worth seeking the best credit repair services before you apply. 

But there are other aspects that can influence the rates you’re offered, too, such as your down payment and whether you’re looking for a 15-year or 30-year term. This is why you want to seek the very best mortgage lenders who can work with you to determine the kind of mortgage you can afford, and can source the best deals accordingly. 

Yet it can be difficult to know where to start, which is where we come in. The following overview highlights the best mortgage lenders who come out on top in a range of categories, from the one with the highest service rating to the best lender if you’re on a budget, ensuring there’ll be the solution to your needs. And, if you’re at a different stage of your home-owning journey, make sure to check out the best reverse mortgage companies and HELOC lenders as well.  

Comparing the best mortgage lenders

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Your path to the best mortgage rates doesn’t end once you’ve found suitable lenders, as your next task is getting tailored quotes and comparing the loans you’re offered. This can be easily achieved with the help of a comparison site such as (opens in new tab), which simply asks you to fill in a single form before being presented with the best available options. The best part is that lenders will come to you and will tailor their mortgages to your requirements, leaving you free to choose accordingly. 

1. New American Funding: Best mortgage lender for service  

New American Funding: Best mortgage lender for service

(Image credit: New American Funding)
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A lender that pays close attention to customer service


Application process: Easy, online, accessible, bilingual
APR: Variable dependent on loan type but from 3.1 on 15-year fixed
Fees: as low as 3% dependent on loan type
Calculators, service and support: mortgage calculator, accessible customer service and support, bilingual

Reasons to buy

Online pre-approval process
Online application management and tracking system
Variety of loan types, amounts and lengths

Reasons to avoid

Credit score is still higher than some at 620

New American Funding is one of the best mortgage providers on the market right now. The company is family-run and pays close attention to customer service, adding on little details and making the experience as easy as possible. They offer a wide variety of loan types, they are more welcoming than most when it comes to credit scores, and they have solid customer reviews from reputable sites such as Consumer Affairs. Another tick in the positive box for New American Funding is their use of a manual underwriting process. They don’t rely on an algorithm to determine whether or not you’re worthy of financing.  

2. Rocket Mortgage: Best mortgage lender for fast approvals

Rocket Mortgage: Best mortgage lender for quick approval process

(Image credit: Rocket Mortgage)
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All about online accessibility and a quick approval processes


Application process: Easy, online, accessible
APR: Variable dependent on loan type but 3.5% for 30-year fixed VA
Fees: 2-5% of home’s total cost, closing fees. Origination fee
Calculators, service and support: refinance calculator, mortgage calculator, accessible customer service and support

Reasons to buy

Digital application process
Fast loan application results
Impressive document and asset retrieval tools

Reasons to avoid

Credit scores and debt-to-income ratio credit assessment

Rocket Mortgage is all about online accessibility, quick approval processes and fast approval results. The company has built a site that’s incredibly easy to navigate and populated with plenty of information, clearly marked out areas, and big, fat red buttons. Every step of the application process is highlighted and easy to find, and the FAQ section is detailed and easy to find. The company isn’t as varied in its loan offerings as some of its competitors, but it has a solid reputation as a subsidiary of Quicken Loans and it’s low FICO score of 520 is very appealing. 

3. Flagstar Bank: Best mortgage lender for variety of loans

Flagstar Bank: Best mortgage lender for variety of loans

(Image credit: Flagstar Bank)
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A solid, reliable and well-established bank


Application process: Easy, online, accessible with call center and personalized bookings
APR: 3.723% - 3.9% dependent
Fees: loan and requirement dependent, may have to fork out for mortgage insurance
Calculators, service and support: Personal loan calculator, accessible customer service and support

Reasons to buy

Smooth and easy to use online application process
Full range of loans and services
Well-designed platform with plenty of information

Reasons to avoid

Expect to pay plenty in unexpected fees

Flagstar Bank is a solid, reliable and well-established bank that offers more than just mortgages for those who would rather keep all their finances in one basket. It has a good reputation on the market, albeit some unhappy customer reviews, and it offers a lot of variety when it comes to mortgage loan types. The company offers construction and renovation loans that are a nice addition not found with many other mortgage providers and you can use these to refinance your home, undergo extensive renovations, or even build your own customized loan product that suits your unique requirements.

4. Reali Loans: Best mortgage lender if you're on a budget

Reali Loans: Best mortgage lender for those on a budget

(Image credit: Reali)
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Cheap and cheerful mortgage solution that’s designed to work as seamlessly as possible with your budget constraints


Application process: Easy, online, accessible and fast
APR: 4.274% dependent
Fees: Transparent, understandable, no unnecessary fees
Calculators, service and support: Excellent customer service and support

Reasons to buy

The fees are transparent and some are waived
Easy to navigate and the options clearly explained
Solid range of products that match other providers

Reasons to avoid

It’s only available in a few states 

Reali Loans offers you a cheap and cheerful mortgage solution that’s designed to work as seamlessly as possible with your budget constraints and daily life. What’s really nice about Reali Loans is their transparency – their fees are clearly outlined, their APR is easy to find, and their site is easily navigated so you can find answers to your most pressing questions without losing the will to live. Another advantage of Reali Loans is its fast service – you can get estimated quotes for your mortgage in just a few seconds. It isn’t an accurate quote as there are fees and other elements that you have to consider, but it does help you make an informed choice about your costs and eligibility. 

5. Citibank: Best mortgage lender for value-added services 

Citibank: Best mortgage lender for value-added services

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A full-service banking institution that offers you more than mortgages


Application process: Easy, online, accessible with dedicated homeowner and mortgage and refinancing hotlines
APR: 4.5% 30-year fixed, APR percentages loan dependent
Fees: loan and requirement dependent, may have to pay for mortgage insurance
Calculators, service and support: three different type of mortgage and budget calculators, accessible customer service and support

Reasons to buy

Discounts and value-added extras for Citi customers
$500 credit towards closing costs
Variety of mortgage options

Reasons to avoid

Lack of transparency around fees

Citibank is a full-service banking institution that offers you more than mortgages. If you’re an existing customer, you get some special discounts and value-added services that can make all the difference to your budget. If you’re looking to use one company for all your financial needs, then Citibank has made it worthwhile for you to join them. The website is well-designed and easy to navigate, the FAQ accessible and informative, and the different loan offerings varied enough to make it a great place to start. That said, Citibank has a higher than average APR rate and fairly rigorous FICO score requirements. 

What do you need to apply for a mortgage?

When you are ready to apply for a mortgage, you begin by providing documents and other information to your loan officer. Often, you can be approved quickly, but the loan’s actual underwriting can take more than a month, even longer in some cases.

The lender needs documents to verify your identity and your income. Come prepared with a driver’s license, pay stubs and at least two years' worth of W-2 forms. If you work freelance or on a contract basis, you may need to provide additional documents. In addition, if you receive a monetary gift from a relative to go toward the purchase of your home, they may need to provide a letter for the lender. Further, if you or your partner is a student, you may need to provide school transcripts. 

Your savings and assets come under scrutiny as well. The lender wants to see how much of a down payment you can afford and that your savings comes primarily from income or investments, not from gifts. This assures the lender you can keep up on payments.

Loan officers also check your credit score and report. Generally, 620 is the minimum acceptable score, though there are lending programs you can use if yours is lower. By looking at your credit report, the lender can see what debts you have and your payment history. Lenders also check whether your debts are 36 percent or less of your monthly income. If you need help with your credit score, check out our guide on how to improve your credit score (opens in new tab)

Consider mortgages from credit unions

When looking for a mortgage, consider credit unions as well as banks and other lenders. Credit unions have some advantages over banks, which may make one a better option for you. 

The one drawback to using a credit union is you must be a member to borrow. To join, you may need to be a member of a certain organization or have family members who are. Some credit unions allow you to donate to charities to become a member. You can find nearby credit unions through CULookup.

Credit unions’ lending requirements aren’t as strict as banks’. They have similar credit requirements, though you may find a credit union willing to lend to you if you’re subprime. However, credit unions are more lenient with income requirements – you usually don’t have to makes as much to get approved through a credit union as you do through a bank.

Another advantage is credit unions tend to have lower fees and rates than other lenders. This is partly because credit unions are generally non-profits and keep loans in house rather than sell them like banks tend to do. When you borrow through a credit union, you don’t have to pay as many fees, and closing costs tend to be much lower in general.

What credit score do I need to have to get a mortgage?

“The lowest acceptable FICO score for a conventional mortgage today is 620,” says Jim Sahnger, a mortgage planner with C2 Financial Corp. in Jupiter, Fla. “With FHA loans, it may be possible to find lenders or a mortgage broker that can go down to a 550 FICO.”

For jumbo mortgages, which are loans for larger amounts than the limit set by the Office of Federal Housing Enterprise Oversight (currently $453,100 in most of the United States), you may need higher than a 700.

In all cases, a higher score will get you a better interest rate.

If you're considering refinancing a mortgage then be aware that if your credit score has gone down then the rates you get offered may well be worse than what you have at the moment. You can still check, of course, but it is likely you'll be better of not refinancing and sticking with your current lender. 

If your credit score has improved since you got your mortgage, however, then you should definitely look to refinance. Rates are currently low, and your credit score will complement them. That means there's the potential to save on your monthly payments and overall final mortgage tally.  

The debt-to-income ratio

Your debt-to-income (DTI for short) ratio is your monthly income divided by your monthly debt payments (including the mortgage). As to what debt-to-income ratio is good (opens in new tab), most mortgage lenders state they prefer that borrowers have a DTI of 43 percent or lower, but that’s not always the case.

“Conventional loans can be approved with ratios of up to 49 percent in some cases [for buyers] with good credit and a minimum down payment of 5 percent,” Sahnger says. “FHA and VA loans both allow for higher debt-to-income levels. With FHA loans, it’s possible to go to 56.99 percent, and I have seen VA loans with debt-to-income levels in the 60s. Compensating factors for higher DTI can include higher reserves, higher FICO scores, and down payment amounts that exceed the minimum typically required.”

What is the best interest rate for a mortgage?

The best interest rate you can get for a mortgage depends on your credit score, your debt-to-income ratio, how much money you are able to put down and the size of your loan. You can get a lower interest rate by paying upfront for discount points, which cost 1 percent of your total loan amount and reduce the rate by varying percentages (usually around 0.25 percent per point).

You can look at the week’s average mortgage rates on (opens in new tab) before visiting rate comparison portals such as LendingTree or lenders’ sites and entering more specific info to get a better idea of the best rates available to you.

What is a rate lock?

Mortgage interest rates are constantly fluctuating because they are subject to a variety of economic factors. When you’re approved for a mortgage, the lender gives you the option of locking in the interest rate at the time of your application. This ensures that if rates rise between the approval and final underwriting, you still have the same rate as when you applied for the loan. You may have to pay a fee to lock your rate, though this depends on the lender. Often, you pay a percentage of the loan amount, usually around 0.25%.

Most rate locks last for between 30 and 60 days, which is usually long enough to complete the underwriting process and finalize the sale. The average mortgage takes around 46 days to close, according to Ellie Mae (opens in new tab), a company that provides information to the mortgage industry. 

If the underwriting takes longer, the lender can extend your rate lock, though in some cases you may have to pay to extend it. Generally, you pay a small percentage, between  0.125% and 0.25%, of the loan amount. So you can expect to pay at least a few hundred dollars to extend your rate lock.

It's possible that the rate might fall below the rate you locked in. Some lenders offer the option to “float down” your locked rate. This is an option you can use once to get a lower rate than the one you locked in. It is most often offered for construction loans and loans with long-term rate locks.

What do I need to get preapproved for a mortgage loan?

While you can get prequalified for a mortgage simply by telling a lender about your income, assets, debt and credit score, to get pre-approved you’ll need to give up a lot more information. The lender will need proof of your income (W-2 statements or the equivalent); bank statements that show your assets; and gift letters, if you’re getting help with the down payment from a family member. The lender will then check your credit.

What is private mortgage insurance?

Some lenders may require you to carry private mortgage insurance (PMI), which protects them from liability if you fail to make payments. Most lenders will require PMI if your down payment is less than 20 percent of your home’s price. In some cases, having PMI may increase your likelihood of getting approved with a smaller down payment, though it won’t counteract a less than stellar credit score.

The best way to avoid paying PMI is to save enough for a 20-percent (or more) down payment. With increasing home prices this may be harder to do. Another option is an FHA loan, which only requires a 3.5 percent down payment. If your credit isn’t that great, an FHA loan may be a better option, but it can take longer and does have more fees.

PMI typically costs between 0.5 and 1% of the cost of your home. So on a home that costs $250,000, you can expect to pay $2,500 a year or around $208 a month. Typically PMI costs are added to your monthly payments, though some lenders may require you to pay some or all of it all up front. You can deduct your PMI premium from your taxes.

Getting your PMI removed from the loan can be tricky. After you’ve paid 20 percent of your home’s value, you can ask to have the PMI removed. Lenders may require you to get an appraisal to prove you’ve paid 20 percent of the value, which can be time consuming and costly. Lenders are required to remove the PMI when you’ve paid more than 22 percent of your home’s value.

Can I be denied a loan after pre-approval?

“If there’s something that comes up after the preapproval that was not disclosed during the initial process, either intentionally or inadvertently, that would be cause for being denied,” says Pat Renn, CFP, of Atlanta-based Renn Wealth Management Group (opens in new tab). It’s in your best interest to disclose anything like past bankruptcies, outstanding debt, and any financial litigation during the pre-approval process.

Will pre-approvals hurt my credit score?

When the mortgage lender does what’s called a hard pull of your credit score, which is necessary for preapproval, it does cause your score to dip a few points. The good news is that if you are shopping for a mortgage and more than one lender does an inquiry within a period of about 45 days, the credit reporting agencies recognize that you’re looking for the best rate and will count all of the inquiries as just one.

What if I can’t make my mortgage payments?

Maybe you’ve lost your job or experienced a financial crisis and now find yourself struggling to stay current on your mortgage payments. There are several options to consider before you have to worry about foreclosure:

If you’re going to miss a payment, the first thing you should do is call your mortgage service. You need to explain that you’re experiencing financial hardship and how long you expect it to last as well as provide other details about your financial situation like how much you have in your bank accounts. The servicer will evaluate your situation and consider what options may be available to you. You may need to fill out an application for mortgage assistance.

The mortgage service may offer you forbearance, which reduces or suspends your payments for a period of time. These programs can last for a few months to a year, though the average is around four months. After your forbearance expires, you continue with your regular payments as well as make partial payments or pay a lump sum to make up for what was missed during the forbearance period. This is an option if you’re experiencing temporary financial hardship – for example, if you are on disability leave at your job.

Your mortgage service may also agree to modify your loan by adjusting the rate, extending the term or even adding missed payments to the balance. It may also reduce the amount you owe by forgiving a portion of the debt. 

To be eligible for forbearance or loan modification, you need to show you’ve been making a good faith effort to stay current on your payments and that you have an income-based need for one of these programs. Other more drastic options include declaring bankruptcy or selling the home.

How much would I have to put down as a first-time homebuyer?

Some banks, such as Chase and Bank of America, offer special mortgages that require as little as 3 percent down for first-time homebuyers or people with lower incomes looking to buy in certain areas. Some lenders allow for very small down payments for anyone, regardless of whether they’re first-time buyers, as long as they have good credit and are willing to pay slightly higher rates and private mortgage insurance (PMI) costs.

How much are typical closing costs?

Closing costs can add up and become unexpectedly expensive, which may make the already complicated home buying process even more difficult. In general, you can expect to pay between 2 and 5 percent of the loan amount in closing costs. So on a $200,000 mortgage, you might pay anywhere between $4,000 and $10,000 in closing costs. If you buy discount points on your interest rate, you pay more upfront in closing costs.

Appraisals and home inspections are some of the most common closing costs. The lender requires an appraisal, which gives it an idea of how much the home you’re buying is worth. This usually runs between $300 and $400. A home inspection isn’t required, but it's a good idea – it can let you know if any repairs are needed so you can negotiate with the seller about covering the costs or lowering the sale price. Typically, a home inspection ranges from $300 to $500.

Another common closing cost is the origination fee, which is around 1 percent of your loan’s value. So on our $200,000 example, you’d pay about $2,000 in origination fees. You can also expect to pay a mortgage application fee. The price varies from lender to lender but is often around $500. You may have to pay other small fees as well, including interest for the first month and attorney’s fees. If you used a broker to find your loan, you have to pay a commission of 1 to 2 percent of the loan amount.

If you don’t put up 20 percent of the loan amount as a down payment, you have to pay private mortgage insurance (PMI) as well as some upfront fees. There’s a PMI application fee that varies from lender to lender. You may also need to pay some of the insurance upfront, either one year’s worth of payments or a lump sum that covers the life of the loan. You can expect to pay anywhere from 0.5 to 2.25 percent of your loan amount.

Are no-closing-cost mortgages a good idea?

When you buy a home, closing costs can add up – typically, they are between 2 and 5 percent of your total mortgage. For example, on a mortgage of $150,000, you can expect to pay between $3,000 and $7,500 in closing costs. According to mortgage data provider ClosingCorp (opens in new tab), average closing costs in 2018 were around $3,400. If the upfront closing costs are too much, some lenders may offer you a no-closing-cost option. With a no-closing-cost loan, the lender fronts the closing costs for you and charges you a higher interest rate over the course of your loan.

The advantage of a no-closing-cost mortgage is it can help you get in a home faster. If there’s an issue with getting together enough money for the down payment and closing costs, a no-closing-cost mortgage can fix the problem. With a higher rate, you’ll have higher monthly payments, but you can refinance later. Also, if you stay in the home for shorter than the full term, you may not end up paying back all of the closing costs the lender covered.

If you’re looking at a no-closing-cost mortgage, ask the lender which of the costs it specifically covers. This varies from lender to lender, and though many lenders advertise zero-closing-cost mortgages, you may have to cover some taxes, insurance premiums, and attorney fees. Also check for prepayment or cancellation fees – some lenders require you to own the home for at least three years or pay a penalty. Other lenders may ask you to repay the closing costs if you close early.

What is the best time of year to buy a house? 

The housing market fluctuates depending on many factors, but the current interest rate is the biggest one people look at. However, if you’re looking to buy a house, you may not have the luxury of time to wait for rates to drop. With home prices (opens in new tab) rising 7.7 percent in 2018, timing your purchase right can help save you money.

Finding the right home is a product of supply and demand, though home prices run counter to the common wisdom. Generally, more homes are for sale during the summer months, but that’s when prices also tend to increase. It's in winter that home prices are lower, though you may have fewer options to choose from. Most experts (opens in new tab) agree that January is the best month to buy a home. This may be due in some part to the fact that those homes have been on the market longer, and the sellers might be more willing to make a deal.

If you’re looking for a home, it may be wise to wait until January. However, so many other factors go into the decision, and season shouldn’t be your sole consideration. Your ability to afford a home and make a substantial down payment should take precedence.

What are mortgage points, and should you pay for them?

Mortgage points, sometimes called discount points or discount fees, allow you to pay an upfront fee to reduce your interest rate. That means you pay more upfront, but you have lower monthly payments. 

Discount points are different than a down payment. The down payment applies to the principle whereas the points apply to the interest. A down payment builds equity in your home. For example, if you buy a home for $200,000 and make the minimum 20-percent down payment to avoid paying for mortgage insurance, you already own 20 percent of the home. Discount points don’t help build equity, but the lower monthly payments can help you with your monthly expenses.

To buy a point, you pay 1 percent of the home’s total cost. In our example above, to buy one point you pay $2,000. Many lenders let you pay for partial points, so you could buy half a point for $1,000. The rate reduction varies by lender, but 0.25% is considered average. So, if you have an initial interest rate of 5.00% and buy one point, it will drop to 4.75%.

When buying points, use a points calculator (opens in new tab) to find the break-even point at which you’ll recoup the amount you spent on the points. In our example above, you’ll see a reduction of around $30, so it will take you around 49 months to break even. If you plan on selling before the break-even point, purchasing points is probably not worth the trouble.

You can purchase points on adjustable- and fixed-rate mortgages. With an adjustable rate, the reduction only applies during the initial fixed-rate period, so check to see if the break-even point occurs before that period is over.

What is a VA loan?

If you’re a veteran or are currently serving in the military, you’re likely eligible for a VA mortgage (opens in new tab). This is a loan guaranteed by the Department of Veterans Affairs, which means the requirements are lower than for a conventional home loan.

The main difference between a VA loan and a conventional mortgage is there are no down payment requirements on a VA loan. With a conventional mortgage, you need to put 20% down to avoid paying private mortgage insurance (PMI), and even with an FHA loan, you need to put at least 3.5% down. 

Though there’s no PMI, you have to pay a funding fee. This ranges from 1.25% to 3.3% and isn’t charged to veterans with service-connected disabilities. The fee can be paid upfront or rolled into the loan, which increases your monthly payments. Generally, a down payment of 5% or more reduces this fee.

VA loans also have lower credit requirements – you’ll get better rates with a score of 620 than you would for a conventional loan. With a conventional loan, you need a score of at least 740 to get the best rates. Some lenders may approve VA borrowers with a score in the 580 range, though your rates will likely be higher. VA loans are less strict on the amount of debt you can hold and still be approved.

VA loans tend to have lower interest rates than conventional loans. According to Ellie Mae, which tracks interest rates, VA loans averaged rates of 4.73%, while rates for conventional loans were closer to 5%.

Tamsin Oxford is a freelance technology journalist with a career that spans numerous platforms, technology solutions, markets and industries. She has written and edited numerous technology publications that include PC Zone, PC Format, PC Answers, PC World and many more. Tamsin has written about many different subjects during her time working across Top Ten Reviews.