Arizona Mortgage Lender

    Arizona Mortgage Lender: How Do I Find The Best One?

    The median home price of Arizona is $225,500, somewhat lower than the national median of $269,039. Your search for homes at a bargain price might be a little more challenging than most states, but it’s not impossible. When you do find a reasonably-priced Arizona home, you need a good mortgage lender to capitalize on it. 

    Good mortgage lenders help by providing you loans with affordable rates and excellent customer service. If you’re looking for the best Arizona mortgage lender, we’ve got you covered. Read on for our top five Arizona mortgage lender picks and learn the key criteria so you can do your own research!

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    Choosing An Arizona Mortgage Lender

    You need a set of criteria to know which one is the right mortgage lender or bank for you. We have five key factors that help determine which lender works best to suit your needs.

    Mortgage Loan Options Offered

    Mortgage lenders and banks offer a wide variety of loan types catering to different needs. Knowing what these loan options are and how they can help you is important before starting your search for the best lender.

    Here are some of the most common loan options currently available from a lender or bank:

    • Conforming mortgages: Any home purchase loans that are valued under the state’s lending limits. Arizona’s lending limits are set at $548,250.
    • Jumbo mortgages: People looking for more expensive homes can apply for a jumbo loan. They can exceed local lending limits with the tradeoff of higher interest rates. 
    • Fixed-rate mortgages: As the name implies, these loans have static interest rates. Their stability makes them a good choice for first-time homebuyers. 
    • Adjustable-rate mortgages (ARMs): These mortgages have interest rates that readjust every year. However, they usually feature an initial fixed-rate period that ranges between 3 and 10 years.
    • Government loans: Most government-backed mortgages originate from the Federal Housing Authority, the United States Department of Agriculture, and the Department of Veterans Affairs. These loans typically offer lower rates and low down payment requirements to eligible borrowers. 
    • Mortgage refinancing: Refinancing entails taking out a new loan to pay for your existing one. You take this to save money either by changing your mortgage terms or taking advantage of lower refinance rates.
    • Home equity lines of credit (HELOC): This loan provides you with a source of funds, similar to a credit card, with your home as collateral.

    Affordability 

    Arizona mortgage rates constantly fluctuate and may be subject to change depending on your financial circumstances. For a more reliable measure of affordability, we examine how easy it is to qualify for a loan from a lender or bank with these factors:

    • Minimum credit score: Your FICO score is one of the primary ways for a lender to determine your qualification. You can increase this score by making timely payments on all bills and debts. Most lenders prefer to see a minimum score of 620, but some may consider your home loan application even if your score is under 620. 
    • Minimum down payment: The rule of thumb is that consumers provide a 20% down payment on mortgages. However, some lenders and home loan programs accept down payments as little as 3% – but may require you to pay private mortgage insurance.  
    • Closing costs: The cumulative cost of your appraisal expenses, origination fees, and other payments are placed in your closing costs. These fees must be paid upon closing and can cost up to 5% of your total loan amount. Some lenders offer to waive these expenses by folding them into your home loan payments, saving you the upfront expense. 
    • Homebuyer assistance programs: Each U.S. state has housing authorities that provide assistance programs. These are down payment loans, closing cost grants, and low-rate mortgages generally available for first-time homebuyers. However, some states may have assistance programs for repeat homeowners. 

    Application Process

    The ease of applying for a mortgage is an important factor, especially for new homebuyers. We use three metrics to measure how easy it is to apply for a home loan:

    • Availability of online applications: Online applications are almost expected of mortgage lenders nowadays. They provide a sizable advantage to consumers who can’t visit a lender’s office and apply in person with a loan officer or mortgage banker.  
    • Rate transparency: Having mortgage rates displayed before application helps consumers compare between lenders easier. Some lenders display rate quotes prominently on their website, while some others may require them to input financial information or talk to a loan officer first.  
    • Length of the application process: Time is a key concern in mortgages because you may be looking to buy a home before somebody else does. Most mortgages close within a few weeks, but in some cases, your mortgage may take several months to be finalized. 

    Customer Service And Ratings

    You’re entrusting a mortgage lender or bank with hundreds of thousands of your dollars. That’s why choosing a lender with great customer service can give you peace of mind. If your mortgage encounters problems, you know you can depend on your loan officer to help solve them. We measure a mortgage lender’s customer service quality with the help of two rating organizations: The Better Business Bureau and J.D. Power.

    The Better Business Bureau is an organization that rates the trustworthiness of a business. It grades them with a letter grade ranging from F to A+ based on things such as how well the company handles complaints and the transparency of its business practices. 

    J.D. Power is a market research organization that analyzes feedback from customers across various industries. It gathers data from customer surveys and publishes the results in an annual study report that ranks and awards the top-performing companies. 

    Access To Services

    A highly accessible lender generally fulfills these two criteria:

    • It must serve loans all over the United States
    • Optionally, it operates many branches across multiple states

    The first criterion is self-explanatory – if a lender doesn’t service loans for Arizona homes, you need to search for other lenders. The second one helps those who prefer face-to-face interaction with mortgage brokers and loan officers.

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    The Best Arizona Mortgage Lenders 

    With the five aforementioned criteria in mind, we’ve come up with a list of the top five Arizona mortgage lenders. Each pick is the best at something, so read through all of them and choose the Arizona lender that best suits your needs.

    1. Rocket Mortgage By Quicken Loans – Best Online Lender 

    Credit score requirement: 620 (580 for FHA)

    Down payment requirement: 3%

    Loan products offered: 

    • Fixed-rate loan
    • ARMs
    • Jumbo mortgages
    • FHA & VA loan
    • Mortgage refinance loan

    BBB Rating: A+

    JD Power rating: 883 (first place in 2020 study) 

    Overview: As the online arm of direct mortgage lender Quicken Loans, Rocket offers robust online lending capabilities to its borrowers. Moreover, Rocket has proven itself to be one of the best mortgage lenders by ranking first in 2020’s J.D. Power study.

    It boasts an easy and intuitive application system that allows you to finish applying in thirty minutes. It also provides you with supporting features like online loan tracking and electronic document signing, so you can go through the entire mortgage process from home.

    However, you may be out of luck if you’re looking for face-to-face mortgage experience. Since Rocket Mortgage by Quicken Loans is an exclusively online mortgage lender, you can only speak to a loan officer through the phone. 

    Lender availability: Rocket Mortgage by Quicken Loans is available nationwide with no branch offices.

    2. Navy Federal Credit Union – Best For VA Loans

    Credit score requirement: N/A

    Down payment requirement: 0%

    Loan products offered: 

    • Fixed-rate loan
    • ARMs
    • Jumbo mortgages
    • VA loan
    • Mortgage refinance loan

    BBB Rating: N/A

    JD Power rating: 867 in the 2020 study

    Overview: Virginia-based Navy Federal Credit Union provides mortgages and other financial products to its 9 million members. While it’s known as one of the best mortgage lenders for VA loans, it also provides many conventional mortgages. To complement those offerings, Navy Federal boasts two signature programs: the HomeBuyers Choice and Military Choice loans.

    Both of these loans are zero-down, fixed-rate 30-year purchase mortgages for first-time and military borrowers. Both feature a 1.75% funding fee, but it can be waived and folded into your interest rate, reducing the upfront expense. 

    Lender availability: Navy Federal services home loans nationwide and operate 322 branch offices in 30 states

    3. Fairway Independent Mortgage – A Variety Of Mortgage Options 

    Credit score requirement: 620 (580 for FHA & VA)

    Down payment requirement: 3%

    Loan products offered: 

    • Fixed-rate loan
    • ARMs
    • Jumbo mortgages
    • Government-backed loans
    • Mortgage refinance loan
    • Home equity loans

    BBB Rating: A+

    JD Power rating: 865 in 2019 study 

    Overview: Fairway’s greatest advantage is its wide variety of loan types that range from conventional to government home loans. This direct mortgage lender also offers renovation loans and HELOCs to supplement its home loan offerings. With this complete suite of loan products, it can cater to many types of borrowers. 

    You can apply for a Fairway mortgage online through its website or app. If you’re looking to talk directly to a loan officer or mortgage broker, you can also visit one of its 700 branch offices or make a phone call. However, you may need to start an application to see Fairway’s mortgage rates since they don’t post sample rates online.

    Lender availability: The company offers loans and operates 700 branch offices nationwide.

    4. New American Funding – Best For Nontraditional Credit & First-Time Buyers

    Credit score requirement: 620 (640 for FHA, VA, and USDA loans)

    Down payment requirement: 3%

    Loan products offered: 

    • Fixed-rate loan
    • ARMs
    • Jumbo mortgages
    • Government-backed loans
    • Mortgage refinance loan
    • Home equity loans

    BBB Rating: A+

    JD Power rating: N/A

    Overview: California-based New American Funding is one of the few family-owned mortgage lenders that sits in the top 20 national lender list. This company has received high marks when it comes to serving underserved consumers and potential homeowners, especially minorities. This commitment is shown by its mortgage volume – 28% of its loans in 2019 were attributed to Black and Hispanic borrowers.

    New American Funding isn’t quick to deny applications, because it doesn’t rely exclusively on automated underwriting. Your loan officer will look closer into your financial profile and consider things such as timely rent payments to help you qualify. 

    Lender availability: New American Funding serves loans nationwide and operates 200 branches in 31 states. 

    5. LoanDepot – Best For Refinance

    Credit score requirement: 620 (580 for FHA)

    Down payment requirement: 5%

    Loan products offered: 

    • Fixed-rate loan
    • ARMs
    • Jumbo mortgages
    • FHA & VA loans
    • Mortgage refinance loan

    BBB Rating: A+

    JD Power rating: 844

    Overview: Over 60% of LoanDepot’s mortgage volume in 2019 was attributed to refinancing. One of the primary reasons why refinancing is so popular at LoanDepot is its “lifetime guarantee”. The company places a guarantee on all its mortgages – if the borrower refinances, they won’t have to pay lender fees, which helps them cut down on the upfront expenses. 

    In addition to its refinancing guarantee, LoanDepot also boasts a robust application system much like other online lenders. Its Mello Smartloan system helps automate most of the process – and saves consumers time from having to dig up old paperwork to verify financial information. 

    Lender availability: This lender offers mortgages and operates 200 offices nationwide. 

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    Closing Thoughts 

    While home prices in Arizona are close to national values, you’re still likely to find a good-priced home in the Grand Canyon State. Finding a good mortgage lender allows you to get the best rates and make financing your first home in Arizona much more affordable. 

    If you’re looking for more information and advice about financing a home in Arizona, Wesley Mortgage, LLC is here for you! Our professional team is ready to help you navigate the mortgage lending process and make your dream home come true!

    Written By Ed Wallace
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