3 of the best and worst mortgage lenders
Although mortgage lenders all provide the same essential service – offering loan products to customers – they are not all the same. Some lenders charge higher fees for the same services, such as application and underwriting fees, according to Forbes.
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Also, depending on the size of the lender, number of locations, and other factors, some lenders may get you better rates. Other criteria that can make one lender better than another include the speed of the loan application process, customer service, and location. Based on these criteria, here are three of the best and worst mortgage lenders, but keep in mind that everyone’s experience may be different.
Best: New American Funding
ConsumersAdvocate.org chose New American Funding as its top choice for lenders in 2022 based on several criteria, including: historically low rates; free prior approval; the ability to apply for a mortgage online and speak with live agents, as well as down payment and first-time homebuyer assistance programs.
This lender serves all states except Hawaii and New York. Homebuyers can get loans with a minimum down payment of 3% and a credit score of 620 or higher. For a small regional lender, New American provides an in-house lending service and offers flexible terms. They have also been rated well for their good customer service and transparency.
According to NerdWallet, they offer a wide variety of loan products including: Purchase, Refinance, Home Equity, Reverse, Jumbo, Fixed, Adjustable, FHA, VA, USDA.
Best: Quicken Loans
Quicken Loans (now known as Rocket Mortgage) is one of the largest online mortgage lenders in the United States. On the plus side, because they have such a large network of lenders, borrowers are more likely to find a loan option with a low interest rate and payment terms that work for them.
Plus, according to ConsumersAdvocate.org, they have a streamlined digital fence system that makes signing all documents simple and convenient. Homebuyers can get loans with a minimum down payment of 3% and a credit score of 620 or higher. They also earned an A+ from the Better Business Bureau.
According to NerdWallet, they offer the following loan types: Purchase, Refinance, Jumbo, Fixed, Adjustable, FHA, VA. The downsides are that they don’t offer home equity loans, and sometimes lender fees can be high.
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Forbes chose Better as one of its top picks for mortgage lenders because of its penchant for convenience and speed. Not only is the application process completely digital, but they have a fast pre-approval time – as little as 20 minutes.
Their closing time is also 32 days on average, about 10 days less than the industry average. This lender is also actively seeking discounts that borrowers may qualify for at no additional cost.
Best of all, they don’t charge commission or lender fees for anything from application to underwriting or origination fees. They claim that it saves 1% of the loan amount, or about $19,000 on average, over the life of the loan. Better services in all 50 states, excluding Nevada – including Hawaii, Massachusetts, Minnesota, New Hampshire, Vermont and Virginia – plus Washington, DC You need a minimum credit score of 620 to apply.
Worst: DHI Mortgage
This Texas-based mortgage lender appears to have done more harm than good. In addition to being charged too much interest by the California Department of Business Oversight in 2013 and 2017 (for which they had to pay penalties to settle claims), according to a statistical survey by The Markup, this lender also has a bad record. loans to minority candidates.
They found he was 160% more likely to turn down black applicants and 100% more likely to turn down Latino applicants than white applicants.
Worst: Sage Mortgage
For a borrower who wants lots of options and the ability to buy in a wide variety of states, Sage Mortgage is probably not the right choice for you, as they are a relatively new and only mortgage lender. available in the following states: California, Colorado, Florida, Georgia, Minnesota, North Carolina, Oklahoma, Oregon, South Carolina or Texas.
This lender is really best for those who are comfortable with a do-it-yourself approach, who don’t need a lot of hands-on. Additionally, loans are capped at $548,250, which may limit where you might want to buy. Also, you need a credit score of 660 to apply.
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Worst: Chase Bank
Chase is one of America’s largest banks and mortgage lenders. Like other lenders, they offer a variety of loan products and can facilitate minimum down payments of 3% and more.
However, US News and World Report only rated them 3.7 out of 5 on the affordability scale compared to other lenders, and they only got a B+ from the Better Business Bureau. Larger lenders can sometimes take longer to complete a loan. Chase charges fees for things like origination, underwriting, and rate lock fees.
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This article originally appeared on GOBankingRates.com: 3 of the Best and Worst Mortgage Lenders