Who classifies as a first-time homebuyer?

A first-time homebuyer is anyone who hasn’t bought a home previously. That might mean you’re a renter, or you’re moving from your family home to your first home. For you to qualify for a first-time homebuyer loan or assistance, however, doesn’t mean you have to genuinely be a novice at homeownership. You’re classified as a first-time homebuyer if you haven’t bought a home in the past three years.

What are first-time homebuyer programs?

A first-time homebuyer program typically includes a mortgage with a lower interest rate, lower down payment requirement and other ways to save, such as lower mortgage insurance premiums. There are many different kinds of first-time buyer programs, including 3 percent down conventional loans, 3.5 percent down FHA loans and no-down payment loans for eligible military members or buyers in rural areas.

What are first-time homebuyer grants?

If you’re a first-time homebuyer and lack funds for a down payment or closing costs, you might be eligible for a first-time homebuyer grant. Grants are a one-time lump sum that often don’t have to be repaid if you stay in the home for a certain period of time or meet other criteria.

How much do I need to save for a down payment as a first-time homebuyer?

It varies widely. If you have a credit score of at least 620, for example, you might qualify for a conventional loan with a down payment as low as 3 percent of the home’s purchase price. If your credit isn’t that great, you might opt to put down slightly more — like 3.5 percent for an FHA loan. If you’re in the military or buying a home in a rural area, you might not need to set aside anything for a down payment. What’s more: In 2023, some lenders introduced 1 percent down mortgages, which come with free grants so that you only need to put down 1 percent. There’s also income-based down payment assistance, which could cover some or all of yours. Ultimately, how much you should save depends on your homebuying budget, your credit, income and many other factors.

Best mortgage lenders for first-time homebuyers in 2025

Written by

Jeff Ostrowski,

Edited by

Suzanne De Vita

Published on February 07, 2025 | 2 min read

Bankrate is always editorially independent. While we adhere to strict , this post may contain references to products from our partners. Here's an explanation for . Our is to ensure everything we publish is objective, accurate and trustworthy.

With so many mortgage lenders out there, it can be challenging to know where to start, especially if you’re a first-time homebuyer. We assessed several key criteria to help narrow down the top mortgage lenders for first-timers, including first-time buyer and low-down payment loans and down payment assistance. Here is our guide to the best mortgage lenders for first-time homebuyers in 2025.

Best mortgage lenders for first-time homebuyers

Lender	Credit requirements	Down payment minimum	Bankrate Score
Chase	620 for conventional loans; 680 for jumbo loans; 640 for FHA loans and VA loans	3% for conventional loans; 3.5% for FHA loans; none for VA loans	4.9
Veterans United Home Loans	620 for conventional and VA loans	3% for conventional loans, 3.5% for FHA loans, none for VA and USDA loans	4.9
Bank of America	620 for conventional loans	3% for conventional loans; 3.5% for FHA loans; none for VA loans	4.8
Better	620 for conventional loans; 580 for FHA loans; 620 for VA loans	3% for conventional loans; 3.5% for FHA loans; none for VA loans	4.8
PenFed Credit Union	650 for conventional loans; 700 for jumbo loans; 620 for FHA loans	3% for conventional loans; 3.5% for FHA loans; none for VA loans	4.8
PNC Bank	620 for conventional loans; jumbo loans and FHA loans; 640 for USDA loans	3% for conventional loans; 3.5% for FHA loans; none for VA loans or USDA loans	4.8
U.S. Bank	620 for conventional loans; 740 for jumbo loans; 640 for FHA loans	3% for conventional loans; 3.5% for FHA loans; none for VA loans	4.8
Wells Fargo	620 for conventional loans	3% for conventional loans; 3.5% for FHA loans; none for VA loans or USDA loans	4.8

Chase

Learn more in our Bankrate review

- Availability: All U.S. states
- Loans offered: Conventional, jumbo, FHA, VA
- Credit requirements: 620 for conventional loans; 680 for jumbo loans; 640 for FHA loans and VA loans
- Down payment minimum: 3% for conventional loans; 3.5% for FHA loans; none for VA loans
- Where to find: Branch locations and online
Pros

Available to borrowers in all states, with 4,700 branch locations

Existing Chase customers might receive rate discount

$5,000 closing guarantee
Cons

Bank might not be a fit for borrowers with unique credit or financial circumstances

Branches not located in all states
Chase scores well for affordability, availability and borrower experience, and we named it the best mortgage lender for first-time homebuyers in our 2025 Bankrate Awards. The bank is the largest in the U.S., with low-down payment options like 3 percent conventional loans and 3.5 percent FHA loans, as well as a grant up to $7,500 for eligible buyers.

Veterans United Home Loans

Learn more in our Bankrate review

- Availability: All U.S. states
- Loans offered: Conventional, jumbo, FHA, VA, USDA
- Credit requirements: 620 for conventional and VA loans
- Down payment minimum: 3% for conventional loans, 3.5% for FHA loans, none for VA and USDA loans
- Where to find: Branch locations and online
Pros

Specializes in VA loans

24/7 customer service over the phone

Lower rates than the national average
Cons

No HELOCs or home equity loans

Limited number of branches
Veterans United Home Loans scores well for affordability, availability and borrower experience. The lender primarily deals in VA loans, which are for eligible military and don’t require a down payment or mortgage insurance. It’s especially renowned for its customer service, with consistently rave testimonials on Bankrate and other third-party sites.

Bank of America

Learn more in our Bankrate review

- Availability: All U.S. states
- Loans offered: Conventional, jumbo, FHA, VA
- Credit requirements: 620 for conventional loans
- Down payment minimum: 3% for conventional loans; 3.5% for FHA loans; none for VA loans
- Where to find: Branch locations and online
Pros

Offers grants to help low- and moderate-income buyers

Displays rates online

Awards discounts for Preferred Rewards customers
Cons

Has limited transparency around borrower requirements

Does not offer USDA loans
Bank of America scores well for affordability, availability and borrower experience. In addition to low- and no-down payment conventional, FHA and VA loans, the bank provides eligible homebuyers up to $10,000 in a down payment grant and up to $7,500 in closing cost help, neither of which need to be repaid.

Better

Learn more in our Bankrate review

- Availability: All U.S. states
- Loans offered: Conventional, FHA, VA
- Credit requirements: 620 for conventional loans; 580 for FHA loans; 620 for VA loans
- Down payment minimum: 3% for conventional loans; 3.5% for FHA loans; none for VA loans
- Where to find: Online
Pros

Mostly online, with real-time online rates, three-minute preapprovals and hybrid closings

One Day Mortgage with approval in 24 hours for eligible borrowers

Price Guarantee matches or beats competitor offers
Cons

Branch locations in just 10 states

No USDA loans
Better scores well for affordability and availability. The online-only lender tends to advertise more affordable rates and its offerings include first-time buyer-friendly programs like conventional, FHA and VA loans.

PenFed Credit Union

Learn more in our Bankrate review

- Availability: All U.S. states
- Loans offered: Conventional, jumbo, FHA, VA
- Credit requirements: 650 for conventional loans; 700 for jumbo loans; 620 for FHA loans
- Down payment minimum: 3% for conventional loans; 3.5% for FHA loans; none for VA loans
- Where to find: Branch locations and online
Pros

Competitive rates

Convenience of managing banking and mortgage with one provider
Cons

No ability to customize rates online

Higher minimum credit score requirements

No USDA loans
PenFed Credit Union scores well for affordability, availability and borrower experience. The credit union is open to anyone for membership, and while it specializes in VA loans, it also offers a low-down payment conventional option with no income limit and up to $1,500 for closing costs if you work with a partner real estate agent to buy your home.

PNC Bank

Learn more in our Bankrate review

- Availability: All U.S. states
- Loans offered: Conventional, jumbo, FHA, VA
- Credit requirements: 620 for conventional loans; jumbo loans and FHA loans; 640 for USDA loans
- Down payment minimum: 3% for conventional loans; 3.5% for FHA loans; none for VA loans or USDA loans
- Where to find: Branch locations and online
Pros

Online and in-person options to apply

Application can be tracked online

Wide availability with many loan options
Cons

Higher credit minimum on FHA loans

Limited mobile app functionality

Below-average J.D. Power rating for mortgage servicing
PNC Bank scores wells for affordability, availability and borrower experience. The bank provides eligible first-time buyers with up to $5,000 in closing cost help, and it makes it easy to compare current mortgage rates right on its website.

U.S. Bank

Learn more in our Bankrate review

- Availability: All U.S. states
- Loans offered: Conventional, jumbo, FHA, VA
- Credit requirements: 620 for conventional loans; 740 for jumbo loans; 640 for FHA loans
- Down payment minimum: 3% for conventional loans; 3.5% for FHA loans; none for VA loans
- Where to find: Branch locations and online
Pros

Provides lender credit worth up to $1,000 for qualifying banking customers

Displays rates online

Offers new construction loans
Cons

Tougher borrower requirements for FHA loans (640 credit score in most cases)

No USDA loans
U.S. Bank scores wells for affordability, availability and borrower experience. The bank offers many mortgage options for a variety of circumstances, including borrowers who don’t have a credit score. It also provides up to $10,000 in down payment and closing cost assistance to homebuyers in certain states.

Wells Fargo

Learn more in our Bankrate review

- Availability: All U.S. states
- Loans offered: Conventional, jumbo, FHA, VA, USDA
- Credit requirements: 620 for conventional loans
- Down payment minimum: 3% for conventional loans; 3.5% for FHA loans; none for VA loans or USDA loans
- Where to find: Branch locations and online
Pros

Displays mortgage rates online

Massive branch network

Will consider non-traditional credit references in application process

Offers low-down payment options to assist lower-income borrowers
Cons

Dialed back its mortgage offerings

No longer offers home equity lines of credit (HELOCs)

Below-average customer satisfaction scores and negative past customer reviews
Wells Fargo scores well for affordability, availability and borrower experience. The bank offers savings to eligible homebuyers, including up to $10,000 in down payment assistance in certain metro areas and up to $5,000 off closing costs for lower-income buyers. One caveat: It has scaled its mortgage lending down to existing customers, so unless you bank with Wells already, you might need to look elsewhere for a mortgage.

How to find the best mortgage lender as a first-time homebuyer

There are several different kinds of mortgage lenders you might come across in your search for a loan, including banks, credit unions and independent and non-depository institutions. You might also encounter mortgage brokers, who can help you uncover loan offers from a variety of lenders.

As you look for a lender, consider your goals and what you might value in your experience getting a mortgage. What kind of loan are you looking for? How long do you plan to stay in the area? Would you feel better with 24/7 support? Do you need homebuyer education? Your answers can help you narrow down your choices.

Once you have a short list, shop around and compare mortgage offers. Lenders include the APR (annual percentage rate) and interest rate on an offer, but you’ll really want to consider the APR, which reflects the actual cost of the mortgage. In general, the lower the APR, the cheaper the loan will be.

Learn more: How to compare mortgages as a first-time homebuyer

FAQ

A first-time homebuyer is anyone who hasn’t bought a home previously. That might mean you’re a renter, or you’re moving from your family home to your first home. For you to qualify for a first-time homebuyer loan or assistance, however, doesn’t mean you have to genuinely be a novice at homeownership. You’re classified as a first-time homebuyer if you haven’t bought a home in the past three years.
A first-time homebuyer program typically includes a mortgage with a lower interest rate, lower down payment requirement and other ways to save, such as lower mortgage insurance premiums. There are many different kinds of first-time buyer programs, including 3 percent down conventional loans, 3.5 percent down FHA loans and no-down payment loans for eligible military members or buyers in rural areas.
If you’re a first-time homebuyer and lack funds for a down payment or closing costs, you might be eligible for a first-time homebuyer grant. Grants are a one-time lump sum that often don’t have to be repaid if you stay in the home for a certain period of time or meet other criteria.
It varies widely. If you have a credit score of at least 620, for example, you might qualify for a conventional loan with a down payment as low as 3 percent of the home’s purchase price. If your credit isn’t that great, you might opt to put down slightly more — like 3.5 percent for an FHA loan. If you’re in the military or buying a home in a rural area, you might not need to set aside anything for a down payment. What’s more: In 2023, some lenders introduced 1 percent down mortgages, which come with free grants so that you only need to put down 1 percent. There’s also income-based down payment assistance, which could cover some or all of yours. Ultimately, how much you should save depends on your homebuying budget, your credit, income and many other factors.

To determine the best mortgage lenders for first-time homebuyers, Bankrate periodically evaluates more than 75 lenders for factors relating to affordability, availability and borrower experience, assigning each a Bankrate Score out of five stars. The best mortgage lenders for first-time homebuyers generally have a Bankrate Score of 4.8 stars or higher. Learn more about our methodology.

Written by

Jeff Ostrowski

Writer and Housing Market Analyst

Up next

Part of Mortgages for First-Time Home Buyers

Best mortgage lenders for first-time homebuyers

Chase

Lender details

Pros and cons

Pros

Cons

Why we chose Chase

Veterans United Home Loans

Lender details

Pros and cons

Pros

Cons

Why we chose Veterans United Home Loans

Bank of America

Lender details

Pros and cons

Pros

Cons

Why we chose Bank of America

Better

Lender details

Pros and cons

Pros

Cons

Why we chose Better

PenFed Credit Union

Lender details

Pros and cons

Pros

Cons

Why we chose PenFed Credit Union

PNC Bank

Lender details

Pros and cons

Pros

Cons

Why we chose PNC Bank

U.S. Bank

Lender details

Pros and cons

Pros

Cons

Why we chose U.S. Bank

Wells Fargo

Lender details

Pros and cons

Pros

Cons

Why we chose Wells Fargo

How to find the best mortgage lender as a first-time homebuyer

FAQ

Who classifies as a first-time homebuyer?

What are first-time homebuyer programs?

What are first-time homebuyer grants?

How much do I need to save for a down payment as a first-time homebuyer?

Methodology

Up next