Best Mortgage Lenders of 2021

    Best Mortgage Lenders of 2021: 8 Options For Every Need

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    Buying a house is one of the biggest decisions a person could make in their lifetime. And in the midst of a global pandemic and economic downturn, it may not seem like a wise decision at first. But with mortgage rates hitting historic lows and more and more people adjusting to the work-from-home setup, it may not be such a bad idea after all. 

    In this guide, we tackle what it’s like to take out a mortgage in these times and list down our top picks for the 8 best mortgage lenders in 2021.

    Getting A Mortgage In 2021: What To Expect

    With everything that has happened, shopping for a mortgage in 2021 is considerably different than it used to be. If you’re looking to buy this year, here are three things you can expect:

    You’re Up For Some Competition

    The real estate market is hot right now, with more buyers than there are homes for sale. In this situation, it’s important to keep a cool head and not let the pressure get to you. Remember that buying a home is a long-term commitment – don’t make any rash decisions just to seize low rates. 

    Social Distancing Will Change The Application Process

    Like most of our social interactions, expect the home buying process to go fully digital. Real estate agents and mortgage companies have had to adapt to social-distancing regulations, replacing physical walkthroughs with virtual house tours, relying on Facetime and Zoom for meetings, and letting buyers send their documents or complete their applications online. 

    Rates Are Low Now, But They Could Be On The Rise Soon

    While mortgage rates hit an all-time low last year, don’t expect them to stay the same in 2021, especially as the economy starts to recover and vaccinations are rolled out. According to Freddie Mac, the average interest rate for a 30-year fixed-rate mortgage soared by 2.97 percent since last year. But take note – average rates are still much lower than they were pre-COVID. 

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    How To Prepare For A Mortgage In 2021

    Before you start shopping for a mortgage, you need to make sure you’re ready – financially and mentally. Otherwise, you could just end up wasting your time. Here’s what you can do:

    Stay On Top Of Your Credit Score

    Before sending in an application, make sure you’ve got a solid credit score first. Your credit score is a number that reflects your creditworthiness and provides lenders with key insight into whether you can be trusted with a big loan. This number can go down if you allow your debts to pile up, apply for too many lines of credit, or don’t pay your bills on time.

    Generally speaking, most lenders will accept a credit score of 620 or higher. For jumbo loans, you may need to hit about 700. The higher your credit score, the better your chances are of getting a good deal. 

    Save Up For Your Down Payment

    With mortgages, the rule of thumb when paying down is to give at least 20 percent of the principal loan amount. Otherwise, most lenders will require you to pay for private mortgage insurance, which can be rolled into your monthly payments.

    It’s important that you set realistic goals when saving up for a down payment. Not everyone can afford to pay that 20 percent upfront! Even if you do try to save for the amount over a few months or years, you may end up putting yourself through a lot of financial strain. 

    Instead, you can look for lenders that offer low-down-payment requirements. These days, you’ll find a lot of mortgage lenders that are willing to settle for as low as 3 percent down. 

    Prepare For ALL The Costs Involved – Not Just The Down Payment

    A lot of first-timers assume that once they pay the down payment, they’re set. But in reality, your computation for your mortgage payment should include the following closing costs:

    • Application fees
    • Attorney charges
    • Courier fees
    • Credit report fees
    • Mortgage insurance
    • Mortgage points
    • Homeowners insurance
    • Title insurance
    • Origination fees
    • Pest inspection
    • Appraisal fees
    • Property tax
    • Rate lock fees
    • Transfer tax
    • Underwriting fees

    In general, closing costs can amount to 2 to 5 percent of your principal amount. 

    Be Patient And Shop Around

    No two mortgage lenders are the same. Some offer a variety of loan options, while others have a more specialized approach. Not all lenders have the same rates, fees, and requirements as well. 

    This is why it’s integral for homebuyers to be thorough about their research. This is especially true if you’re on a tight budget, where seemingly minor differences in closing costs, down payment limits, or even minimum credit score requirements could either save or set you back thousands of dollars. 

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    How To Choose The Best Mortgage Lender

    When looking at our top picks for 2021's best mortgage lenders, how do you know what to prioritize? For our list of the best mortgage lenders of 2021, we focused on the following factors: 

    Mortgage Products Offered 

    There are several different types of loans:

    • Conforming mortgage: These are loans that conform to the maximum borrowing limit, which is $548,250 across 48 states, and $822,375 in Hawaii, Alaska, and other high-cost markets.
    • Jumbo loan: Also called non-conforming loans, these exceed the maximum limit.
    • Fixed-rate mortgage: This is a type of loan wherein the mortgage interest rate remains the same till the end of the loan term. Generally, you can get 10- to 30-year terms with a fixed-rate mortgage. These loans are good for people who want stability and consistency.
    • Adjustable-rate mortgage: As opposed to the fixed loan, an ARM is a loan wherein the interest rate stays the same for an initial period, then fluctuates (typically, annually) depending on market shifts. ARMs typically come in 3/1, 5/1, 7/1, and 10/1 mortgages, where the first number represents the initial fixed period.
    • Government-backed loans: The Federal Housing Administration, the Department of Veteran Affairs, and the Department of Agriculture all offer affordable mortgages with low credit score and low down payment requirements. These government-backed mortgages are usually best for low-income and first-time buyers.


    Mortgage rates are constantly in flux, making it hard to pinpoint an “affordable” rate. So while it’s good to keep an eye out for low rates, we suggest keeping an eye out for the following as well when evaluating lenders:

    • Minimum down payment
    • Minimum credit score
    • Debt-to-income ratio requirements
    • Closing costs

    Application Process

    Applying for insurance in the midst of a pandemic poses a specific set of problems. How do you go through the motions of buying a house when you’re encouraged to stay indoors and stay six feet away from people at all times? 

    Thankfully, technology has helped make the application process much easier in spite of these limitations. Some lenders boast 100-percent online applications through online portals or mobile apps, where you can even securely send digital copies of document requirements. Meanwhile, other lenders still lag on this front, requiring applicants to finalize their applications in person. 

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    Customer Service And Satisfaction

    When you get a mortgage, you’re in it for the long haul. As such, you’ll want to work with lenders that have solid track records when it comes to customer service. You want someone who you can depend on for inquiries and issues, can accommodate requests, and is responsive when you need them.

    To assess this, we turn to two third-party agencies: JD Power and the Better Business Bureau. 

    The former is a marketing firm that specializes in data analytics. In 2020, they put together an overall customer satisfaction index ranking from their U.S. Primary Mortgage Origination Satisfaction Study. 

    The BBB, on the other hand, assesses’ companies’ trustworthiness by looking at things like complaint histories, licensing and government actions, advertising issues, and the like. 


    Don’t forget to look at a lender’s availability, or whether they have loan officers and/or brick-and-mortar locations near you. While some mortgage lenders may originate loans in all 50 states, not all will have physical locations in all states or cities. And though this may not pose that big of a problem for lenders that offer online applications, do keep in mind that some lenders require applicants to finalize their applications in person. 

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    Our Top 8 Best Mortgage Lenders of 2021

    Here are our top picks for the 8 best mortgage lenders of 2021: 

    1. Rocket Mortgage by Quicken Loans: Best Overall

    Why it made our list: Quicken Loans is an online lender that offers conventional, jumbo, fixed-rate, adjustable-rate, flexible-term, and government-back mortgages. With competitive interest rates, a variety of term options, and winning service (they’re #1 on JD Power’s Customer Satisfaction Index!), Quicken Loans easily makes the top of this list.

    Loan types offered: Conventional loans, FHA loans, VA loans, jumbo loans, fixed-rate, adjustable-rate, and flexible-term mortgage products. Quicken Loans does not offer the following: home equity loans, home equity lines of credit, land loans, or USDA loans.

    Min down payment: 3%

    Min credit score: 620

    Online applications: Yes

    JD Power Ranking: 883/1000

    BBB Rating: A+

    Availability: Available in all 50 states, but no brick-and-mortar branches

    Pros: Excellent service, fully online application, competitive mortgage rates

    Cons: Does not offer HELOCs, home equity loans, or USDA loans

    2. Bank of America: Easy Application And Affordable Solutions

    Why it made our list: On top of the usual fixed-rate, adjustable-rate, and government-back loans, Bank of America also offers two loan options that are accessible to low-income or first-time homebuyers – the Affordable Loan Solution mortgage which requires as little as 3 percent down and no PMI; and the Freddie Mac Home Possible mortgage, which offers a lower-than-average PMI for those paying below 20 percent down. 

    Aside from these, Bank of America boasts a breezy 100 percent online application process and excellent service – they’re tied for second on JD Power’s customer satisfaction index.

    Loan types offered: Conventional, jumbo, fixed-rate, home equity, ARM, VA, and FHA loans. They also offer an Affordable Solution Mortgage, which requires as little as 3 percent down and no mortgage loan insurance.

    Min down payment: 3%

    Min credit score: 620

    Online applications: Yes

    JD Power Ranking: 860/1000

    BBB Rating: A+

    Availability: Available in all 50 states, with over 5,000 branches in the United States

    Pros: Excellent service, variety of mortgage products, affordable solutions for first-time buyers, online application, and discounts for existing customers.

    Cons: Bank of America does not disclose their mortgage fees, USDA loans are not offered, and pre-approval can take up to 10 days

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    3. New American Funding: Best For Borrowers With Low Credit Scores

    Why it made our list: This family-owned mortgage lender is relatively new to the game – having been founded in 2003 – but New American Funding has quickly grown to become a leading non-bank lender in the US. New American Funding’s main draw is their use of manual underwriting, which allows them to look beyond the usual credit ratings to come up with a more comprehensive understanding of an applicant’s financial situation. 

    New American Funding also has an “I Can” mortgage program which requires a credit score of at least 500. Borrowers can choose any term from 8 to 30 years.

    Loan types offered: Fixed-rate, adjustable-rate, jumbo, reverse, FHA, USDA, and VA loan products. They also offer home equity and refinancing. 

    Min down payment: 3%

    Min credit score: 500

    Online applications: Yes

    JD Power Ranking: N/A

    BBB Rating: A+

    Availability: Not available in New York and Hawaii

    Pros: Low credit score requirement, online applications, variety of loan types offered

    Cons: The lender doesn’t disclose mortgage fees. They also have less than 200 branches nationwide and not in all states. 

    4. Veterans United Home Loans: Best VA Loans

    Why it made our list: Veterans United is the largest mortgage refinance company with a focus on VA mortgages. They’re known to be one of the most convenient places for military borrowers to apply for a loan, with their 24/7 hotline and 100 percent online applications. 

    Non-military applicants can also apply for a loan at Veterans United. 

    Loan types offered: Conventional home loans, jumbo loans, fixed-rate loans, adjustable-rate mortgages, and government-backed loans like FHA, VA, and USDA loans. Veterans United does not offer HELOCs or home equity loans.

    Min down payment: 0%

    Min credit score: 640

    Online applications: Yes

    JD Power Ranking: 873/1000

    BBB Rating: A+ 

    Availability: Veterans United only has branches in 18 states.

    Pros: 24/7 customer hotline, zero percent minimum down payment, variety of loans for both military and non-military applicants

    Cons: The minimum credit score is higher-than-average at 640. They also only have brick-and-mortar locations in 18 states, making it a bit difficult to make personal inquiries if needed.

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    5. Navy Federal Credit Union: Best Incentives For Military Homebuyers

    Why it made our list: The Navy Federal Credit Union is another well-known mortgage lender among military families. It has two standout loan products: the HomeBuyers Choice mortgage, which comes with no mortgage insurance premiums and is meant for first-time buyers; and the Military Choice mortgage, which offers special prices on interest and origination costs for both active-duty members and veterans. 

    Other incentives for military homebuyers: cash back upon closing, rate-match guarantee, and a rate relock option.

    Loan types offered: Conventional, fixed-rate, adjustable-rate, Military Choice, Homebuyers Choice, VA loans, and home equity loans. They offer rate-and-term refinance and cash-out refinance options.

    Min down payment: 0%

    Min credit score: 620

    Online applications: Yes

    JD Power Ranking: 867/1000

    BBB Rating: A+

    Availability: Navy Federal has 344 branches worldwide.

    Pros: Zero down payment, no private mortgage insurance, no underwriting fees, and incentives for military applicants

    Cons: You have to be a member to avail of benefits, no FHA or USDA loans are offered. 

    6. Chase Bank: Best For Beginners

    Why it made our list: Chase Bank is one of the biggest banks and mortgage lenders in America, with nearly 5,000 brick-and-mortar locations around the country. As a mortgage lender, Chase is favored for its impressive customer satisfaction and affordable options for first-time homebuyers. 

    Its DreamMaker program comes with competitive interest rates and the option to pay as little as three percent down. The down can also be settled with an eligible gift fund or grant. If you complete a homebuyer’s education course, you get $500 which you can also put towards your down. 

    Loan types offered: Chase has fixed-rate loans, adjustable-rate loans, jumbo loans, VA loans, and FHA mortgage options. This lender offers home equity lines of credit and refinancing loan products as well. Chase does not offer home equity and USDA loans. 

    Min down payment: 3 percent

    Min credit score: 620

    Online application: Yes, but you have to call a loan officer or go to a branch to finalize your application. 

    JD Power Ranking: 860/1000

    BBB Rating: A+

    Availability: Chase has 4,700 branches in the US across 39 states.

    Pros: Good option for first-time buyers, excellent 24/7 customer service, solid range of loan options. 

    Cons: The application process could be better. Rate lock fees are also required for certain loans.

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    7. Flagstar Bank: Best Jumbo Loan Lender

    Why it made our list: Flagstar is a midwestern bank that boasts low minimum credit score requirements as well as discount programs and incentives for existing customers, vets, and active-duty military. On top of this, you can get high-balance loans from Flagstar, particularly if you’re buying in a high-cost area. 

    Loan types offered: Conventional loans, fixed- and adjustable-rate mortgages, jumbo loans, government-back loans (FHA, VA, and USDA), and construction loans. Flagstar also offers renovation loan products (Fannie Mae HomeStyle loan, Flagstar Destination loan, and FHA 203(k)), multiple-property loans, and high-balance loans. 

    Min down payment: 3%

    Min credit score: 620

    Online applications: Yes

    JD Power Ranking: 821/1000

    BBB Rating: A+

    Availability: Flagstar has branches in Indiana, Michigan, Ohio, and Wisconsin. 

    Pros: Variety of loan options (including high-balance loans), low credit score requirements, incentives for existing customers and military members

    Cons: Physical branches are only available in the midwest. 

    8. Most Convenient Lender

    Why it made our list: impresses with a 100 percent online application process, speedy pre-approval time (you can get pre-approved in 20 minutes!), and zero lender fees. 

    According to their website, believes that homeownership should be “fast, transparent, and low-cost” and have accessibility as its core tenet. The lender is backed by banks like Citi, Goldman Sachs, and American Express.

    Loan types offered: Conventional loans, jumbo, fixed-rate loans, ARMs, FHA, and interest-only mortgages. does not offer VA loans or USDA loans. 

    Min down payment: 3%

    Min credit score: 620

    Online applications: Yes, 100 percent online. 

    JD Power Ranking: N/A

    BBB Rating: A-

    Availability: No brick-and-mortar locations, but you can apply for a home loan from anywhere in the world. 

    Pros: No commission or lender fees (saving you up to 3 to 6 percent of your principal home loan amount). The fast pre-approval time and 100 percent online application make it perfect for people who are in a rush to get their mortgage finalized.

    Cons: has no brick-and-mortar locations, no VA or USDA loans, and no land loans. 

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    The Bottom Line

    Although buying a home in these times may seem like a bold financial move, it's hard to ignore today's trend of a lower interest rate. But before you start applying, make sure you’re 100 percent ready to commit to this big, long-term financial decision. 

    Get your credit score in order, allot some time to save up for not only your down payment but closing fees as well, and make sure to get to know your options. There is a myriad of mortgage lenders out there, each with its own advantages and disadvantages. Take your time to shop around and find the best one for your needs.

    Ready to take out a mortgage? Want to learn more about personal finance? Head over to our blog – we’ve got a ton of resources, like guides to mortgage rates, life insurance reviews, and basic finance articles.

    Written By Ed Wallace
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