Indiana Mortgage Lender

    What Makes A Good Indiana Mortgage Lender? Our Criteria & Top Picks

    With the median home price of $151,900, homes in Indiana are considerably cheaper than the rest of the country. This is good news if you’ve ever thought about finding a perfect home in Hoosier State. However, finding a cheap home is only the first step. You also need to find a good mortgage lender so you can capitalize on the affordable home prices.

    Finding the right mortgage lender isn’t easy, but we’ve got you covered. Read on for our top five Indiana mortgage lender picks and learn how to find the best mortgage lenders to finance your new home!

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    Choosing A Mortgage Lender 

    You need to do some research when it comes to choosing the best mortgage lender. To focus your search, we have five criteria that you can use to compare multiple lenders: 

    Mortgage Loan Products Offered

    Since mortgage needs vary between homebuyers, the right solution for someone else may not be right for you. To make sure you choose the right loan for your new home, you need to understand the products being offered. Here are the most common mortgage loan options available today:

    • Conforming mortgages: Mortgage loans that are valued under local lending limits. Lending limits in Indiana are set at $548,250. However, FHA loans typically have lower lending limits. 
    • Jumbo mortgages: Mortgage loans that allow borrowers to purchase expensive real estate by exceeding lending limits. However, they usually come with higher rates. 
    • Fixed-rate mortgages: Mortgages that feature fixed interest rates. Their predictability makes them good for first-time homebuyers. 
    • Adjustable-rate mortgages (ARMs): The mortgage rates on ARMs readjust annually based on a market index. To give them initial stability, most lenders give borrowers between 3 and 10 years of fixed interest rates.
    • Government loans: Government-backed loans offer perks like a great rate and reduced down payment requirements to qualifying borrowers. Three government bodies sponsor these mortgages: the Federal Housing Authority, the U.S. Department of Agriculture, and the Department of Veterans Affairs. 
    • Mortgage refinancing: Refinancing entails taking out a new mortgage to pay off your current home loan. Refinancing is usually done to save money by getting a lower refinance rate or changing your loan terms. 
    • Home equity lines of credit (HELOC): A form of home equity loan that works like a credit card and uses your real estate as collateral. 

    Affordability 

    Mortgage rates can change all the time, so current rate estimates aren’t the best measure of affordability. Instead, we use four key metrics when measuring a mortgage lender’s affordability:

    • Minimum credit score: A good FICO score doesn’t only ensure you qualify for a new home loan, it also makes you eligible for lower rates. Most lenders require a minimum score of 620, but some lenders allow you to qualify with a lower score – making homeownership more affordable and accessible.
    • Minimum down payment: Lenders generally expect you to pay 20% down, but nowadays you can qualify with as little as 3%. However, if you pay less than 20% down, you’ll likely have to pay mortgage insurance expenses.
    • Closing costs: Your closing costs include origination fees, application expenses, and other things the lender charges you during your lending process. The amount varies by lender, but you usually need to pay 2-5% of your mortgage amount.
    • Homebuyer assistance programs: Many state housing authorities offer homebuyer assistance programs to help both first-time and repeat homeowners save money. These range from loans with low down payments to closing cost grants.

    Application Process

    A mortgage lender’s application process is another important point of consideration – if a lender takes too long to assess your application, someone else might snatch up your dream home first. We use three metrics to measure the ease of application:

    • Availability of online applications: Online mortgage applications are a large advantage to those who can’t apply in person with a loan officer. But while they’re important for some, the lack of online applications isn’t a deal-breaker for everyone – especially if a lender has good branch coverage.
    • Online rate information: Being able to see interest rate estimates on the website makes it easy for borrowers to compare rates between lenders. Some lenders display them directly on the website, while others may require you to speak to a loan officer or provide financial data first.
    • Length of the application process: Time is important in mortgage lending since you may be looking to buy a home before someone else buys it. Most lenders close your loan within a few weeks, but busy lenders may take several months to complete the entire process.

    Customer Service And Ratings

    Mortgages cost a lot of money, so you don’t want to be left high and dry if there’s an issue with your loan. This is why customer service is an essential part of our consideration process. To measure this criterion, we use scores from two rating organizations: J.D. Power and the Better Business Bureau (BBB).

    BBB measures a company’s trustworthiness with a letter grade, ranging from F to A+. Some of the factors BBB uses in its rating process include customer complaint resolution, the existence of government actions against the business, and transparency of business practices.

    J.D. Power is a market research agency that scores businesses primarily on customer feedback and satisfaction. It publishes its findings in an annual study and gives awards to the highest-ranked companies. 

    Access To Services

    Lender accessibility is our final point of consideration. Good customer service and competitive rates are irrelevant if a lender doesn’t serve your area. Here, we examine a lender’s service coverage as well as the number of branch offices it operates. 

    While many lenders originate loans nationwide, some may not be licensed to lend in several states. Similarly, many nationwide mortgage lenders only have branch offices in a handful of states, which makes it tougher to get an in-person meeting with a loan officer or consult with mortgage brokers. 

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    The Best Indiana Mortgage Lenders

    Based on the five aforementioned criteria in mind, we’ve compiled a list of the five best mortgage companies in Indiana. They all have their own specializations and are the best at something, so be sure to pick the lender that best fits your needs. 

    1. SoFi - Best Online Service

    Credit score requirement: 620

    Down payment requirement: 10%

    Loan products offered: 

    • Fixed-rate loans
    • ARMs
    • Mortgage refinance loans

    BBB Rating: A+

    JD Power rating: 871 on 2020’s consumer lending study

    Overview: SoFi is a digital finance company that provides a wide variety of services ranging from student loans to cash management and investments. In line with its other services, SoFi also provides an all-digital mortgage lending experience. You’ll also be assigned a loan officer to guide you through the entire lending process. 

    Currently, SoFi offers conventional loans as well as mortgage refinancing. It used to offer jumbo purchase loans but has suspended them for the time being due to the pandemic. You may also need to look for other lenders if you’re planning to get an FHA loan since it doesn’t offer any government-backed mortgage options.

    SoFi offers plenty of advantages to its members. Eligible SoFi members can receive a $500 closing cost discount on their SoFi mortgage. You can also get rate discounts on other loan products if you have a SoFi mortgage. 

    Lender availability: Mortgages are available nationwide except in Hawaii, Missouri, New Mexico, New York, and West Virginia.

    2. Guaranteed Rate - Best For Fast Pre-Approval

    Credit score requirement: 620 (600 for VA & FHA)

    Down payment requirement: 3%

    Loan products offered: 

    • Fixed-rate loans
    • ARMs
    • Jumbo loans
    • Government-backed loans
    • Mortgage refinance loans

    BBB Rating: A-

    JD Power rating: 832 in 2020 study

    Overview: Guaranteed Rate offers detailed sample interest rates on its suite of mortgage products, making it easier to estimate your affordability. While the company primarily does its business online, it also operates 300 branch offices for those who prefer in-person applications with a loan officer. Moreover, it boasts a quick pre-approval process that can be completed within minutes. 

    However, Guaranteed Rate only scores an A- in its BBB rating, compared to the A+ boasted by its peers. This rating was the result of a government action due to the lender issuing ineligible FHA loans. 

    Lender availability: Licensed to originate mortgages nationwide with 300 branch offices across 46 states

    3. New American Funding - Best For Nontraditional Credit 

    Credit score requirement: 620

    Down payment requirement: 3%

    Loan products offered: 

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

    BBB Rating: A+

    JD Power rating: N/A 

    Overview: Family-owned lender New American Funding is a top-20 mortgage company in the nation that primarily serves minorities and people with nontraditional credit profiles. Over 28% of its 2019 home loan volume went to Hispanic and Black customers, compared to the national average of 14%. 

    Instead of using automated underwriting software, New American Funding reviews applications manually. This allows it to look at a borrower’s financial profile closely and reduces the chances of rejected loan applications. This helps give people with limited income and freelancers a better chance of financing a new home.

    Its commitment to supporting minority homebuyers also extends to customer service – New American Funding provides bilingual phone assistance.

    Lender availability: New American Funding is licensed to originate mortgages nationwide and operates 200 branches in 49 states. 

    4. Navy Federal Credit Union - Best For Military Families 

    Credit score requirement: 620

    Down payment requirement: 3%

    Loan products offered: 

    • Fixed-rate loans
    • ARMs
    • Jumbo loans
    • VA loans
    • Mortgage refinancing

    BBB Rating: N/A

    JD Power rating: 867

    Overview: Boasting more than 9 million members, Navy Federal prides itself on serving the military community and their families. Navy Federal members can apply for conventional and VA mortgages by applying online or with a loan officer at one of its branches. 

    The HomeBuyers Choice and Military Choice mortgages are Navy Federal’s premier home loan programs. Both offer zero-down loans without private mortgage insurance for first-time homeowners and military members. You can also reduce the amount of cash needed at closing by folding the closing fees into your interest payments.

    Lender availability: Navy Federal services mortgages nationwide and operates 322 branches in 30 states. 

    5. Bank of America – Best Closing Cost Discounts 

    Credit score requirement: 620 (640 for FHA, 660 for VA)

    Down payment requirement: 3%

    Loan products offered: 

    • Fixed-rate loans
    • ARMs
    • Jumbo loans
    • FHA & VA loans
    • Mortgage refinancing
    • Home equity loans

    BBB Rating: A+

    JD Power rating: 860 (second place in 2020 study) 

    Overview: As one of the largest banks in the country, Bank of America (BoA) offers a complete suite of financial services. Borrowers can apply through BoA’s online portal, by phone, or at any of its branch offices across the nation. Once you’ve applied for a loan, you can track the lending process through its Home Loan Navigator portal. 

    If you’re already banking with BoA, you may be eligible for a closing cost discount worth $600. You can also participate in the Community Homeownership Commitment program and receive up to $10,000 worth of down payment assistance plus a $7,500 closing cost grant. 

    Lender availability: BoA offers mortgages and operates over 4,300 branch offices nationwide.

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    Closing Thoughts 

    You need the right mortgage lender if you’re planning to get an affordable home in Indiana. Choosing the best lender allows you to take advantage of the cheap home prices and save money in your real estate transaction.

    For more information about home loans and mortgage lenders in Indiana, contact Wesley Mortgage, LLC today! Our professional team is ready to help you land your dream home in the Hoosier State.

    Written By Wesley Mortgage
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