How To Find The Best Maryland Mortgage Lender

Residential real estate located in Maryland costs around $314,800 – putting it in the top 10 most expensive states to buy a home in the United States and well above the national median of $269,039. 

However, housing prices in Maryland are not the entire picture. You will also need to consider other factors that come into play when purchasing a home: current mortgage rates, refinance rates, and the specific mortgage lenders available in your area. 

Every mortgage lender is different, so there’s no overall “best mortgage lender”. Some lenders are stricter than others when it comes to credit scores and debt-to-income ratio. Some will require higher down payments or will have higher closing fees. Finding the right lender is just as important as finding the perfect home, especially for a first-time homebuyer. 

If you’re looking for a first home close to the heart of America, then this guide is for you! We’re going to be breaking down the best Maryland mortgage lenders in 2021 and offer you advice on how to choose which one is right for you. 

How To Choose A Maryland Mortgage Lender

Before getting into our top 5 picks for the best Maryland mortgage lenders, we have to first talk about how we decided on which ones to put on our list. We looked at 6 main factors during the evaluation process: 

•  Home loan products offered
• Affordability
• Ease of application
• Customer service and satisfaction
• Availability

Let’s break these factors down below. 

Mortgage Options

There are quite a few different mortgage products available today, including:

• Conforming loans: Some of the more common purchase loan types buyers will encounter, these are loan types that fall within the Maryland lending limits of $548,250. 
• Jumbo mortgages: These are loans that exceed the maximum limit and are usually used when buying bigger properties. 
• Fixed-rate loans: As the name suggests, these are loan types that have a fixed or unchanging interest rate. They are usually offered in terms of 10, 20, or 30 years and will have the same rate throughout the loan’s entire tenure – perfect for those who want consistency in their payments, like people buying their first home. 
• Adjustable-rate mortgages: On the other hand, adjustable-rate mortgages are only fixed for a certain amount of time (sometimes called the introductory period). After that period is over, the interest can fluctuate annually depending on the current market. These loans come in terms of 3/1, 5/1, 7/1, and 10/1. The first number refers to the length of the introductory period, while the second number refers to the number of times the rate can change in a year. 
• Government-backed loans: These mortgage loans are backed by the federal government and are typically offered to first-time homebuyers who may have poor credit or smaller savings.  Specifically, they are offered by the Federal Housing Authority, the Department of Veterans Affairs, or the United States Department of Agriculture. 
• Mortgage refinancing: Known colloquially as a refi, this is a new loan you can take on to pay off an outstanding loan.  Buyers usually opt for refis when they want to take advantage of terms and rates that are better than their current loan. Alternatively, it’s also a great way to consolidate your debt for easier tracking. Refis can include rate and term refinancing, cash-in refinancing, and cash-out refinancing. 
• Home equity lines of credit: HELOC, as most people call it, refers to a financial product that acts like a credit card using the value of your home. Your home or property will serve as collateral if you default on your payments.

Affordability

The actual rates offered by a mortgage lending business are always changing. Instead of looking at a lender’s posted prices, we instead look at how easy a lender makes it to take out a home loan with them from four criteria:

• Minimum credit score: Your lender determines whether you qualify for a loan with your credit score. Most lenders require a credit score of 620 for home loans, but some accept lower scores. The lower the credit score requirement, the easier it is to qualify for. 
• Minimum down payment: Most lenders prefer to see a 20% down payment, but some may accept as little as 3%. However, most low-down mortgages require you to pay private mortgage insurance. 
• Origination fee and closing costs: Lenders charge you many expenses during the mortgage process, most of which will be rolled into your closing costs. This fee is usually paid upfront and costs you about 5% of your mortgage. Some lenders boast “free” closing costs, but most of them simply fold these costs into your interest payments.
• Homebuyer assistance programs: Many U.S. states – including Maryland with the Maryland Mortgage Program – offer assistance programs aimed at both repeat and first-time homebuyers. These programs typically offer mortgages with low rates, closing cost assistance, and down payment loans. 

Application Process

Convenience is another key aspect of the mortgage experience. We measure the ease of a lender’s application process through three metrics:

• Availability of online applications: Nowadays, online application forms are expected from almost all mortgage loan originators. This feature is especially useful for people who can’t apply for mortgages in person with a loan officer at a branch location.
• Rate transparency: Having rate estimates easily accessed helps you rate shop and compare between multiple lenders. Some lenders display their rates on the site, but some may need you to enter financial information or speak to a loan officer first. 
• Length of the application process: Mortgages typically close within a few weeks. However, in some cases, your loan can take several months to get a solid closing date. Before you settle on a mortgage lender, ask your loan officer about the average closing times and prepare all necessary paperwork when applying.

Customer Service And Ratings

Good customer service from a financial institution or credit union is important because you’re investing a lot of your money in them. You want a lender that always has a loan officer ready for you if there’s a problem with your loan. For a better look at the customer service of major mortgage lenders, we use data from the Better Business Bureau and J.D. Power.

The Better Business Bureau assigns businesses a letter grade that ranges from F to A+ based on its trustworthiness. The organization comes up with these grades by examining the company’s handling of complaints from customers and transparency of business practices, among others.

J.D. Power is a market research firm that concentrates on customer feedback. It compiles surveys from consumers and publishes an annual study to recognize the best-performing company in each industry. 

Access To Lender

There are two ways to measure a lender’s accessibility:

• The number of states it serves
• The number of branches it operates and how many states it covers

The first point is relevant because if the lender doesn’t serve consumers in Maryland, you have to search for another lender. 

The second point primarily helps people who prefer face-to-face consultation with Maryland mortgage brokers.

5 Best Maryland Mortgage Lenders

With the five points above as our guide, we’ve compiled a list of the top five Maryland mortgage lenders. Each of these mortgage loan originators is the best at something, so pick the one that can best cater to your needs. 

1. Rocket Mortgage By Quicken Loans – Best Online Service

Credit score requirement: 620 (580 for FHA)

Down payment requirement: 3%

Loan products offered: 

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

BBB Rating: A+

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

Overview: Rocket Mortgage by Quicken Loans offers a completely online mortgage experience for its borrowers. The company boasts that its online application can be completed within thirty minutes. 

Rocket has made this online application as beginner-friendly as possible. Consumers will receive hints and instructional videos throughout the process so they won’t get lost. They can also contact a loan officer at any time to answer questions.

Since Rocket is a subsidiary of Quicken Loans, all home loans offered to consumers come from Quicken. Rate shopping can be done online, but an accurate rate estimate needs a credit check – which might impact their credit scores.

Lender availability: Rocket Mortgage by Quicken Loans services mortgage loans nationwide, but does not operate physical branch offices. 

2. Veterans United – Best For Military Families

Credit score requirement: 640

Down payment requirement: 0%

Loan products offered: 

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

BBB Rating: A+

JD Power rating: 873

Overview: Boasting $175 million worth of VA loans in 2019, Veterans United’s experience in VA loans is second to none. However, Veterans United does offer other government and conventional loan products to its borrowers.

While Veterans United provides loans primarily for military homeowners, it also accepts loan applications from veterans, reservists, and their families. It also boasts 24/7 customer service so they can speak to mortgage brokers at any time. 

Lender availability: Veterans United services loans nationwide, but only operates 25 branch offices in 18 states.

3. Carrington Mortgage Services – Best For Low Credit Scores

Credit score requirement:  620 (500 for FHA & VA, 550 for USDA)

Down payment requirement: 3%

Loan products offered: 

• Fixed-rate loan
• ARMs
• Government-backed mortgage
• Mortgage refinance loans

BBB Rating: A+

JD Power rating: 703 in the 2020 study 

Overview: Carrington is a good choice for consumers who are worried about low credit scores. Instead of solely relying on credit scores, it also examines bank statements and rent payments so they’re more likely to be accepted for a loan. 

Borrowers can apply for a Carrington mortgage online, but it doesn’t feature automatic loan tracking. Consumers will need to contact a loan officer for updates on the loan’s progress.

Lender availability: Carrington services mortgages in 48 states and the District of Columbia. The two states Carrington isn’t licensed to lend in are Massachusetts and North Dakota. It also operates 6 branch offices in Arizona, California, Connecticut, Florida, Indiana, and Maryland. 

4. Fairway Independent Mortgage – Best Variety Of Financial Products

Credit score requirement: 620 (500 for FHA & VA, 550 for USDA) 

Down payment requirement: 3%

Loan products offered: 

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

BBB Rating: A+

JD Power rating: 865 in the 2019 study

Overview: Fairway has a host of mortgage loan products to cater to every kind of borrower. It offers conventional and government home loans as well as renovation loans and HELOCs. 

However, Fairway does have a small disadvantage in mortgage transparency. The company doesn’t publish sample rates anywhere on the site, so you need to talk to loan officers to get rate estimates. 

Lender availability: Fairway services loans and operates 700 branch offices nationwide

5. Bank Of America – Best For Closing Cost Discounts And Down Payment Assistance

Credit score requirement: 620

Down payment requirement: 3%

Loan products offered: 

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

BBB Rating: A+

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

Overview: If you’re planning to save money on your closing fees, Bank of America has you covered. You can participate in its Community Homeownership Commitment program that offers up to $10,000 in down payment assistance and $7,500 in closing cost grants. Moreover, existing Bank of America customers can receive up to $600 for their closing fee. 

Lender availability: Bank of America originates mortgages and operates over 4,300 branches nationwide.

Closing Thoughts

Homes in Maryland are expensive, which means you need to be smart when looking for a new home. Not only that, but you also need to save money by finding the best mortgage lender that gives you excellent rates. 

If you’re looking for more information and advice about buying homes in Maryland, Wesley Mortgage, LLC is here for you! Our professionals will be more than happy to guide you through the mortgage process and help realize your dream Maryland home!