Minnesota Mortgage Lender

    Top Minnesota Mortgage Lender Picks

    The median home price in Minnesota sits at $223,900, a good deal lower than the national median of $269,039. This means finding affordable homes in Minnesota can be easier compared to other states like New York and California. 

    When you do find a reasonably-priced new home, you need a good mortgage lender to help you purchase it. The right mortgage lender can help you get the best mortgage rates and has great customer service – but that’s not all you have to consider when choosing one.

    Start your search by reading this guide! We provide our top five Minnesota mortgage lender picks and explain our criteria if you want to search for a lender yourself.

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    Choosing A Mortgage Lender 

    Finding the right Minnesota mortgage lender can be challenging if you don’t know what to look for. To help in your search, we’ve narrowed down the five key criteria for good mortgage lenders:

    Mortgage Products Offered

    Mortgage lenders offer a wide variety of loan types that cater to different needs. To help you pick the right loan for your financial situation, here’s a breakdown of the most common loan types on the market:

    • Conforming mortgages: All loans that fall under local lending limits are considered conforming mortgages. For the state of Minnesota, lending limits are set at $548,250.
    • Jumbo mortgages: Any mortgages that exceed the state’s lending limits are called jumbo loans. Mortgage lenders offer jumbo loans to buy more expensive homes, providing a larger loan amount in exchange for higher mortgage rates.
    • Fixed-rate mortgages: These loans feature rates that won’t change with market conditions. The stability of these loans makes them the best choice for first-time homebuyers or cautious borrowers.
    • Adjustable-rate mortgages (ARMs): The rates on these loans readjust every year based on market index movements. However, they usually feature an initial fixed-rate period that lasts from 3 to 10 years.
    • Government loans: These loans typically feature low rates and low down payment requirements. The three major organizations that offer these loans are the Department of Veterans Affairs, the U.S. Department of Agriculture, and the Federal Housing Authority.
    • Mortgage refinancing (refi): This loan type entails taking out a new mortgage to pay off your current one. Refis are taken to save money, typically by either changing your loan terms or securing better refinance rates.
    • Home equity lines of credit (HELOC): This type of home equity loan works similarly to a credit card, giving you a source of funds with your home as collateral.

    Affordability 

    Minnesota mortgage rates are always subject to change due to market conditions. For a better measure of affordability, we examine how easy it is to qualify for a loan from mortgage lenders. We look at four factors:

    • Minimum FICO credit score: Your credit score measures how likely you are to pay debts on time. Mortgage lenders usually require a credit score of at least 620, but some of them make their loans more affordable by lowering the minimum credit score.
    • Minimum down payment: Most mortgage lenders require a minimum down payment of 20%, but some may let you qualify with as little as a 3% payment. Most 3% down loans (and most loans under 20%) also require you to pay private mortgage insurance.
    • Closing costs: Your appraisal fees, origination costs, and other expenses will be merged into your closing costs. Mortgage lenders usually charge 5% of your total loan amount for these costs, but some lenders offer to fold your closing costs into your loan payments.
    • Homebuyer assistance programs: Your state may offer assistance programs for both new and repeat homeowners. Typically, these programs come in the form of tax credits, down payment assistance, and closing costs grants. 

    Application Process

    A convenient and easily understandable application makes the mortgage experience better. We measure the application process with three criteria:

    • Availability of online applications: Most mortgage lenders nowadays are almost expected to provide a way to apply online. This is essential for borrowers who can’t apply in person with a loan officer or mortgage banker.
    • Rate transparency: Having easily accessible rates helps potential consumers compare multiple mortgage lenders. Some lenders offer an online mortgage rate calculator on their site, but other lenders may require you to input financial information or talk to a loan officer first.
    • Length of the application process: Most mortgage loans close within a few weeks, but some may take several months to set a closing date. Ask your home loan officer about the lender’s average closing times so you can plan your home purchase accordingly.

    Customer Service And Ratings

    You’re investing a lot of money into your mortgages, so excellent customer support can give you peace of mind. For a quantified look at a lender’s customer service quality, we use ratings from two organizations: the Better Business Bureau (BBB) and J.D. Power.

    The BBB measures the trustworthiness of companies with a letter grade ranging from A+ to F. To come up with these ratings, it looks at business transparency and how well the company handles complaints from consumers. Some companies are also BBB-accredited, meaning it has requested a review and fulfilled BBB’s trustworthiness standards.

    Meanwhile, J.D. Power measures customer service satisfaction by surveying consumers. It rates consumer satisfaction with a 0-1000 score and publishes the results in an annual study report. 

    Access To Services

    There are two important points when discussing the accessibility of a financial institution, whether it’s a lender or bank:

    • How many states it services
    • How many branches it operates nationwide

    The first point is important because if a lender doesn’t service consumers in the Minnesota area, you have to search for other mortgage lenders. 

    The second point is especially relevant for those who prefer applying for loans directly with a loan officer or mortgage banker. If there’s a good spread of branch offices across multiple states, talking with mortgage brokers will be much easier.

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    The Best Minnesota Mortgage Lenders 

    We’ve compiled our top five Minnesota mortgage lenders in this section. Before we get to the detailed breakdowns, here is a quick overview of our top mortgage originator picks. These five lenders generally specialize in something, so choose the one that can best suit your housing needs. 

    LenderMinimum credit scoreMinimum down paymentBBB ratingJD Power rating Best for
    Rocket Mortgage6203%A+ BBB-accredited883Online services
    Guild Mortgage6203%B+BBB-accredited864Product selection
    Navy FederalN/A0%N/A867VA loans
    Bank of America6203%A+ BBB-accredited860Closing cost benefits & large jumbo loans
    LoanDepot6205%A+ BBB-accredited844Refinancing

    1. Rocket Mortgage By Quicken Loans - Best Online Lender

    Credit score requirement: 620 (580 for FHA loans)

    Down payment requirement: 3%

    Loan products offered: 

    • Conforming fixed-rate loans
    • Conforming ARMs
    • Jumbo loans
    • FHA & VA loans
    • Mortgage refinancing

    BBB Rating: A+ and BBB-accredited

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

    Overview: This lender offers a wide variety of loan products mirroring its parent company, direct mortgage lender Quicken Loans. The company boasts that you can finish applying for any of its loan products in 30 minutes with its beginner-friendly online application form. In addition to providing instructional videos on its website, Rocket also allows you to contact a loan officer or mortgage banker for guidance along your mortgage process.

    Lender availability: Rocket Mortgage by Quicken Loans offers online mortgage services nationwide.

    2. Guild Mortgage – Best Loan Selection

    Credit score requirement: 620

    Down payment requirement: 3%

    Loan products offered: 

    • Conforming fixed-rate loans
    • Conforming ARMs
    • Jumbo loans
    • Government loans
    • Mortgage refinancing

    BBB Rating: B+ and BBB-accredited

    JD Power rating: 864 (third place in 2019 study)

    Overview: Guild Mortgage’s greatest strength is its full suite of mortgage loans. In addition to the usual complement of conventional and government loans, it also offers manufactured home loans as well as renovation loans. 

    As another benefit, Guild also offers a 17-day closing guarantee if you’re looking to finalize your loan quickly. If your loan takes over 17 days to close, Guild will give you a closing cost grant worth $500.

    Lender availability: Guild Mortgage is licensed to serve mortgages nationwide except for New Jersey and New York. It operates over 250 branches in 31 states.

    3. Navy Federal Credit Union – Best For VA Loans

    Credit score requirement: N/A

    Down payment requirement: 0%

    Loan products offered: 

    • Conforming fixed-rate loans
    • Conforming ARMs
    • Jumbo loans
    • VA loans
    • Mortgage refinance loans

    BBB Rating: N/A

    JD Power rating: 867 in 2020 study

    Overview: Virginia-based Navy Federal is one of the world’s largest credit unions, providing financial products to over 9 million military members and their families. Navy Federal’s product selection isn’t limited to just VA loans, either. To complement its conventional, VA, and jumbo loan offerings, Navy Federal also boasts two proprietary loan programs called the HomeBuyers Choice and the Military Choice mortgages.

    Both of these programs are zero-down loans meant for first-time and military homeowners. These loans feature a funding fee much like their VA counterparts, but consumers can waive it in exchange for higher interest rates.

    Lender availability: Navy Federal is licensed to serve home loans nationwide and operates 322 branches in 30 states.

    4. Bank Of America – Best For Closing Cost Benefits & Large Jumbo Loans

    Credit score requirement: 620

    Down payment requirement: 3%

    Loan products offered: 

    • Conforming fixed-rate loans
    • Conforming ARMs
    • Jumbo loans
    • FHA & VA loans
    • Mortgage refinance loans
    • Home equity loans

    BBB Rating: A+ and BBB-accredited

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

    Overview: True to its status as one of the world’s largest banks, Bank of America (BofA) offers a complete host of mortgage loans to its customers, including jumbo loans worth up to $2.5 million. However, one of the most notable benefits of financing your home with this bank is its closing cost grants and discounts.

    For starters, existing bank consumers can get a $600 reduction in their closing costs. Moreover, borrowers purchasing a home in select areas can receive up to $10,000 in down payment assistance and $7,500 in closing cost grants through its Community Homeownership Commitment.

    Lender availability: BofA services mortgages and operates over 4,600 financial centers nationwide.

    5. LoanDepot – Best For Refinancing

    Credit score requirement: 620 (580 for FHA)

    Down payment requirement: 5%

    Loan products offered: 

    • Conforming fixed-rate loans
    • Conforming ARMs
    • Jumbo loans
    • FHA & VA loans
    • Mortgage refinance loans

    BBB Rating: A+ and BBB-accredited

    JD Power rating: 844 in 2020 study

    Overview: LoanDepot is a non-bank mortgage lender best known for its refinance loans. 2019’s Home Mortgage Disclosure Act data shows that 60% of LoanDepot’s loan volume comes from refinances. This is reflected in how it treats refinances – LoanDepot offers a “lifetime guarantee” on all its home loans. 

    LoanDepot’s guarantee is very simple. If you get a mortgage from it, any subsequent refinances on that loan will incur no closing costs and lender fees. As a bonus, it will also reimburse any appraisal fees.

    Lender availability: LoanDepot offers online mortgage loans nationwide and operates 200 branch offices in 43 states.

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    Closing Thoughts 

    Choosing the right mortgage lender is essential when it comes to buying a home. The best mortgage lenders provide you with affordable rates and excellent customer support, no matter what kind of loan you need.

    If you’re looking for more resources and advice about the home buying process in Minnesota, contact Wesley Mortgage, LLC today! We’re ready to help you get through the mortgage process and realize your dream home in Minnesota. 

    Written By Ed Wallace
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