Categorized | Mortgages

Best Mortgage Rates for Your New Home: Top 10 Picks

graphics image of mortgage rates

Buying a home is a big goal for many people, and whether it's your very first home or your third home, it's an exciting event.

But, while buying a new home is a huge accomplishment, getting there can be a challenge, especially for finding the best mortgage rates.

To make finding the right mortgage for your new dream home as easy as can be, we've put together the best mortgage rate options for you right here.

Mortgage Rates FAQ

The process of buying a new home is a big task to take on and a huge life-changing event. During this process, it's common for many questions to arise.

The mortgage process, itself, often comes with many associated questions. To make this process easy on you, we've got the answers to some common mortgage questions below.

1. What Is a Mortgage?

A mortgage is a loan taken out for a real estate purchase. Just like with any loan, there is an application process, and, if you're approved, you can borrow a certain amount from the lender and pay it off monthly over multiple years.

The monthly payment and the number of years it takes to pay off the loan will depend on varying factors including the value of your new home.

2. What Is Approval for the Best Mortgage Rates Based On?

Many factors will be considered to determine whether you get approved for a loan or not, but some main factors are income, credit score, and debt to income ratio.

You'll likely have to prove your income by providing W-2s, pay stubs, and past federal tax returns. With credit scores, the higher the better, and good credit scores will lead to lower interest rate offers while lower credit scores will have higher interest rates.

Last, your debt to income ratio is your total gross monthly debts or payments divided by total gross monthly income. The lower this debt to income ratio, the better your chances of approval and lower interest rates.

3. What Are the Different Mortgage Options?

There are some varying mortgage loan options and the two most common ones you should familiarize yourself with are fixed and adjustable rate mortgages.

A fixed-rate mortgage loan is usually the more desirable loan option, and with it, your rate stays the same for the life of the loan. These loans are generally offered for 10, 15, and 30 year loan periods.

An adjustable rate mortgage often offers lower down payments and lower initial rates and payments. This loan provides a lower fixed rate for the initial years of the loan, after the initial years, your rate and monthly payment are subject to change based on current interest rates.

There are also FHA loans, VA loans, interest only loans, and balloon mortgages. FHA (Federal Housing Association) loans are backed by the government, and generally, require significantly lower down payments than other loans.

These loans are ideal for prospective home buyers with a steady income, but without a down payment saved. For those with military affiliations, VA (Veterans Association) Loans are available that are also backed by the government.

These loans also provide low or no down payment options, but there is generally a one-time funding fee charged.

Balloon mortgages are also an option that works for short-term purchases and offers low fixed interest rates for that short period.

A typical period for this type of mortgage is five to ten years, and during that time you may only have to pay the interest. But the rest of the loan is due when the original term is over. A balloon mortgage is not a great option for getting the best mortgage rates, especially if your home depreciates or your credit decreases.

4. What Are the Closing Costs?

With any loan, when you receive the money you are borrowing, it is referred to as “closing”. At the time of closing, there are additional fees associated with the loan that includes:

  • Taxes
  • Prepaid interest
  • Real estate agent fees
  • Title deed transfer fees
  • Legal fees
  • Homeowner's association fees
  • Property surveys/appraisal costs

Purchasing interest point fees to lower your rate

5. Where Can You Apply for One?

Most mortgage loans can be applied for online, over the phone, or in person directly with the lender. Because we understand how big a task buying a new home is, we've provided links for where to apply for each of the best mortgage rates on this list.

How We Reviewed

To provide you with the best mortgage rate options available, we've taken the time to research the most important components.

We've considered features, pros and cons, rates, where to apply, customer service, accessibility, and more to make sure that there's a perfect choice for every prospective home buyer.

Overall Range of the Best Mortgage Rates

Mortgage rates come in a huge range that depends on a variety of factors. The best mortgage rates on this list range from a starting point of around 3.7% to 4.3% for 15 year fixed mortgages.

The range for 30 year fixed mortgages is from around 4.3% to around 4.8%. Of course, these rates will differ based on your income, debt to income ratio, credit score, and more.

What We Reviewed

  • Quicken Loans
  • Better Mortgage
  • LendingTree
  • HSBC Bank
  • Home Loans Today
  • LoanFlight
  • Ally Bank
  • CIT Bank
  • Sebonic Financial
  • CF Bank

10 Best Mortgage Rates

Quicken Loans


Features

Quicken Loans is a Detroit based company that has been around since 1985. They provide mortgage loan offers for refinancing and purchases. This lender features convenience and quick and helpful customer service.

Interest Rates

Best mortgage rates provided by Quicken Loans vary based on many factors such as the type of home your purchasing or refinancing, the primary use of the home, your income, your credit score, and more. Best mortgage rates start as low as 4.375% to 4.99%.

Pros

  • Online application and help from mortgage advisors
  • Excellent customer service
  • Provides instant employment and income verification for many applicants

Cons

  • No in-person application or help
  • No home equity loans offered
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Better Mortgage


Features

Better Mortgage is a digital mortgage lender, so the entire process is online. This lender features a seamless and easy to navigate online application process and a dedicated loan officer for each borrower.

Interest Rates

As with all rates, best mortgage rates form Better Mortgage depend on many variables, but rates start as low as around 3.7% for 15 year fixed rates and 4.3% for a 30 year fixed rate.

Pros

  • Virtual human help provided for the online process
  • Preapproval letter may be provided in as little as 24 hours
  • Loan officers aren't paid off of commission, only for support

Cons

  • Online only process, no in-person application or help
  • Doesn't offer FHA, VA, or home equity loans, or USDA loans
  • Not available in all 50 states

LendingTree


Features

Better Mortgage is a digital mortgage lender, so the entire process is online. This lender features a seamless and easy to navigate online application process and a dedicated loan officer for each borrower.

Interest Rates

Best mortgage rates found by LendingTree start as low as around 3.9% for a 15 year fixed rate.

Pros

  • Competitive rates
  • Connects borrowers with many options
  • Tools for educational resources, credit repair, debt relief, and more

Cons

  • May get calls from many loan providers

HSBC Bank


Features

HSBC Bank is a well-known bank that offers competitive mortgage rates. They offer mortgage, refinancing, and equity options. Applications can be completed online, via phone, or in person.

Interest Rates

Best mortgage rates from HSBC start at around 4.4% for a 30 year fixed rate and around 3.8% for a 15 year fixed rate..

Pros

  • In-person, online, and phone service
  • Mortgage, refinancing, and equity options
  • Well-known and reputable bank

Cons

  • Must meet program qualifications

Home Loans Today


Features

Home Loans Today is a division of FBC Mortgage, LLC. They offer competitive mortgage rates and many loan product options. Their services are better business accredited, and they are FHA and VA approved.

Interest Rates

Home Loans Today offers rates as low as around 4.5% for a 30 year fixed rate and around 4.1% for a 15 year fixed rate.

Pros

  • Offer rate match
  • Fast closing available
  • Competitive rates

Cons

  • No in-person help or application
  • Higher rates than some others on the list

LoanFlight


loanflight best mortgage rates

Image via loanflight.com

Features

LoanFlight strives to make an easy and accessible mortgage process for all. Their mortgage calculator can help you see what types of mortgages you can afford before you apply. They offer loan programs for purchases and refinancing..

Interest Rates

Best mortgage rates from LoanFlight start at around 4.4% for a 30-year fixed rate and around 3.8% for a 15 year fixed rate.

Pros

  • Live chat, email, and phone customer service
  • Competitive rates

Cons

  • Online only

Ally Bank


Features

Ally Bank is a popular online-only bank that provides great savings account options, and they are also an equal housing lender that offer mortgages with competitive rates too. They offer a wide range of mortgages including fixed and adjustable rates, and they also have a special program for first-time home buyers.

Interest Rates

Best mortgage rates from Ally Bank start at around 4.8% for a 30 year fixed rate and around 4.3% for a 15 year fixed rate.

Pros

  • Dedicated customer service team for every step
  • Competitive rates
  • Products and services to meet unique needs

Cons

  • Online only
  • Customer service not available on Sundays

Sebonic Financial


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Image via Pixabay

Features

Sebonic Financial is a division of Cardinal Financial, and they're a consumer direct lending company. Cardinal has been around since 1987, but Sebonic launched in 2013, so they're still fairly new. However, they strive to provide a fast and competitive mortgage experience.

Interest Rates

Best mortgage rates for Sebonic FInancial start at around 4.4% for a 30 year fixed mortgage and around 3.8% for a 15 year fixed mortgage.

Pros

  • Offers purchase, refinance, FHA, VA, and USDA loans
  • Participates in first-time homebuyer program in some states
  • Email and phone customer service

Cons

  • No online preapproval or prequalification
  • Alternative credit data not accepted

CF Bank


Features

CF Bank has been providing loan services since 1892 and prides themselves on customer service and building relationships with their clients. They're a national lender with office locations in the greater Columbus, Cleveland, Akron, Cincinnati, and Columbiana market areas.

Interest Rates

Best mortgage rates at CF bank start at around 4.4% for a 30 year fixed mortgage and around 3.8% for a 15 year fixed mortgage.

Pros

  • Email and phone customer service
  • FHA approved lender
  • VA approved lender

Cons

  • In person offices and support in a limited region

The Verdict

The all-around best mortgage rates for the general home buyer are offered by Better Mortgages, with great service and rates as low as around 3.7% and 4.3% for 15 and 30 year fixed loans, it's a great place to start.

If you enjoy in-person customer service, help, and an in-person application process, then HSBC Bank is a great choice for the best mortgage rates. If you're interested in being connected to multiple lenders so you have many options to choose from, Lending Tree is a great pick.

Whatever your home mortgage needs, choosing one of the best mortgage rates from this list will bring you one step closer to your new home.

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