Best Lenders

Best mortgage lenders of 2021

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There are many mortgage lenders out there, from banks and credit unions to independent institutions and others. Some are based completely online, with the application and approval process all digitally managed, while many more have both an online and physical presence, where you can consult with a loan officer in-person and apply for a loan, or handle some parts of the process through your smartphone.

Bankrate reviewed mortgage lenders in all areas of the housing finance industry, from credit unions and big banks to online lenders. We scored these lenders in three important areas:

  • Expediency (Approval time, close time)
  • Affordability (APR, fees)
  • Borrower experience (Availability, ease of application process)

Based on those scores, here are the best mortgage lenders in 2021.

Best mortgage lenders

1. Better.com

Better.com is a completely digital lender, available in 43 states and Washington, D.C. Its loan products include:

  • Fixed-rate and adjustable-rate mortgages
  • Conventional loans
  • FHA loans
  • Jumbo loans
  • Refinancing (cash-out and rate-and-term)
  • Bridge loans
  • Investment property loans

Better.com boasted some of the lowest rates of all the lenders we scored (of those who advertise rates). Through a 100-percent online process, Better.com can issue preapprovals in three minutes, complete closings within 21 days and doesn’t charge commissions or fees, which amounts to an average $3,500 in savings, the lender says. As of late 2020, the average closing took 55 days, according to Ellie Mae, and typically, fees run 0.5 percent of the loan principal. (For a $280,000 mortgage, that equates to $1,400.)

Along with no fees and a quick process, Better.com also offers the Better Price Guarantee: If you find a lower rate, the lender will match it and give you $100 (and if it can’t match the rate, you keep the money). The guarantee is available only to borrowers who apply directly through the lender, however.

On the downside, Better.com doesn’t offer VA loans, USDA loans, home equity lines of credit (HELOCs) or home equity loans, so if you’re in the market for one of those, you’ll have to go elsewhere. Likewise, if you value an in-person experience, an entirely-online process might not be for you — although the lender does offer robust support, seven days a week, online and by phone, for those who need it.

2. LowRates.com

LowRates.com, also known as LowRates, is a brick-and-mortar and digital mortgage lender operated by Sun West Mortgage Company, available to borrowers in 48 states and Puerto Rico.

LowRates.com has a litany of mortgage products for all kinds of needs, including:

  • Fixed-rate and adjustable-rate mortgages
  • Conventional loans
  • FHA loans, VA loans and USDA loans
  • Jumbo loans
  • Refinancing (cash-out, rate-and-term, FHA, VA and USDA)
  • Home equity lines of credit (HELOCs) and home equity loans
  • Construction loans
  • Investment property loans
  • Renovation loans
  • Reverse mortgages

In addition to its depth of offerings, LowRates.com had some of the lowest rates of the lenders we scored (of those who advertise rates). To expedite the mortgage process, the lender offers “TRU Approval,” which completes underwriting in less than 24 hours, and accelerates closings in as little as 20 days.

For first-time homebuyers or those without considerable down payment savings, the lender also has down payment assistance programs to help cover costs.

However, LowRates.com charges a $1,495 origination fee, which can add to your costs. Its branches cover just 16 states, as well, so if you’re looking for in-person support, it might not be available in your area.

3. Navy Federal Credit Union

Navy Federal Credit Union is a credit union for armed forces members and their families, with more than nine million members worldwide. It has 342 branches globally and throughout the U.S., and its offerings range widely, from banking and credit cards to loans. Its mortgage products include:

  • Fixed-rate and adjustable-rate mortgages
  • Conventional loans
  • VA loans
  • Jumbo loans
  • HomeBuyers Choice loans and Military Choice loans (100-percent financing)
  • Refinancing (cash-out and rate-and-term)

Notably, Navy Federal Credit Union had the lowest rate of all the lenders we scored (of those who advertise rates). Like the other lenders on this list, the credit union completes preapprovals in record time, and doesn’t charge fees for mortgage processing or underwriting, but may charge a funding fee depending on the loan product.

If you’re a member of Navy Federal Credit Union and looking for a loan, your benefits include:

  • 24/7 support
  • Freedom Lock, which allows you two free rate relocks
  • Mortgage Rate Match, in which the credit union either matches a competitor’s rate or you’re paid $1,000
  • RealtyPlus, a cash-back incentive for working with an affiliate real estate agent

Some drawbacks, though: Navy Federal Credit Union is limited to members, and it doesn’t offer FHA loans or USDA loans. Due to the pandemic, it has also suspended home equity lines of credit (HELOCs) and home equity loans, so you’ll have to search for these options with another lender at this time.

How to compare mortgage offers

Your first step to finding the best mortgage lender is to comparison shop. Borrowers who do more upfront research tend to save more money than those who go with the first lender they find. Some experts recommend getting quotes from three lenders, at minimum, so you at least know your options.

As you compare loan estimates, look at the APR (annual percentage rate) and interest rate quoted by each lender you’re interested in. Consider what’s important to you, too. For some, how fast a lender can turn around a preapproval letter or close the loan is critical. If you have specific needs — for example, you want an FHA loan — you might also want to look for the best mortgage lenders who specialize in those products.

Once you determine what your needs and preferences are, you can get started by comparing mortgage rates and finding a lender in your area on Bankrate.

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