We developed a set of scoring criteria to cut through the noise and rated the top 45 mortgage lenders based on a variety of important factors. Each lender received an overall score of zero to five.
Our Review Process
To judge our chosen 45 mortgage lenders fairly, we looked at these major categories and weighted them as such: Companies were rated on a scale of zero to five using a variety of criteria in each category, including whether or not they offer first-time homebuyer grants, the types of loans they offer, and how long it takes them to close. All scores were combined to create an average score for each company.
Data Collection
We collected over 1,200 original data points and looked at data from the NMLS, HDMA, and Scotsman databases. A customer satisfaction survey was conducted of 1,195 mortgage borrowers to better understand opinions about lenders, along with amounts borrowed, interest rates, and mortgage lengths, among other factors. We also reached out to company representatives for more information about their coverage.
Quality of Service
We looked at the following quality of service criteria with the accompanying weights:
Overall customer experience: 42.5%Benefits and grants: 5%Online application: 5%Application assistance online: 2.5%
Overall Customer Experience
In our survey, we asked mortgage borrowers about their satisfaction with mortgage lenders, and we gave each lender a score of zero to 10. The mortgage process can be lengthy and difficult, so providing a good experience for customers is important; this factor accounted for 42.5% of the total score.
Benefits and Grants
Some lenders offer special programs for new and first-time homebuyers, like low or no down payment loans. We gave companies a score of one if they offer such programs, and a score of zero if they do not; this factor accounted for 5% of the total score.
Online Application
We scored companies on whether or not they offer an easy, online application, or if you have to contact a loan officer to get started; companies with an online application scored higher. This factor accounted for 5% of the total score.
Application Assistance Online
Many people would like some form of assistance while completing their mortgage application, even if it’s online. We scored companies on whether or not they offer online application assistance, with a score of zero if they do not and a score of one if they do. This factor accounted for 2.5% of the total score.
Operational Features
We included the following operational features with the accompanying weights:
State licensing: 12%Number of loan officers: 5%Number of loan originators: 5%Brick-and-mortar branches: 5%
Companies that are licensed in more states, with more loan officers and originators, scored better overall. Altogether, operational features accounted for 27% of the total score.
State Licensing
The more states a company is licensed to lend in, the more available it’ll be to the average customer. We rated companies on a scale from zero to one based on how many states they’re licensed to lend in; this factor accounted for 12% of the total score.
Number of Loan Officers
Loan officer availability can affect how soon you can progress through your application, although the number of loan officers employed by a lender can change often. We rated companies on a scale of zero to one based on how many loan officers they have; this factor accounted for 5% of the total score.
Number of Loan Originators
We scored companies on a scale of zero to one based on how many loan originators they have; this factor accounted for 5% of the total score.
Brick-and-Mortar Branches
Although many borrowers may be comfortable applying online, some may prefer to meet their loan officer in person, We rated each company on how many active brick-and-mortar branch locations they have; the more branches, the higher the score. This factor accounted for 5% of the total score.
Types of Loans Offered
There are many types of loans, designed to meet the needs of borrowers in different situations. We rated lenders based on whether or not they offer the following loan types, with the accompanying weights:
Non-conforming jumbo loans: 4.5%FHA loans: 2.5%VA loans: 2.5%Adjustable-rate loans: 2.5%
Altogether, the availability of loan types accounted for 12% of the total score.
Non-Conforming Jumbo Loans
Jumbo loans are large conventional loans that surpass the limits set by the Federal Housing Finance Agency (FHFA); they typically require good credit and a low DTI. We gave companies a score of zero if they do not offer jumbo loans, and a score of one if they do; this factor amounted to 4.5% of the total score.
FHA Loans
FHA loans are backed and insured by the Federal Housing Administration, and they’re typically easier to get than other loan types. We gave companies a score of zero if they do not offer FHA loans, and a score of one if they do. This factor accounted for 2.5% of the total score.
VA Loans
The U.S. Department of Veterans Affairs offers VA loans for eligible servicemembers, veterans, and their families. We gave companies a score of zero if they do not offer VA loans, and a score of one if they do; this factor accounted for 2.5% of the total score.
Adjustable-Rate Loans
Adjustable-rate mortgages have interest rates that can vary over time, rather than being fixed from the start. We gave companies a score of zero if they do not offer adjustable rate mortgages, and a score of one if they do; this factor accounted for 2.5% of the total score.
Accessibility
The following company features are related to the accessibility of mortgage loans; we gave them the accompanying weights:
Days to closing: 5%Debt-to-income ratio: 1%
We gave the most accessible lenders the highest scores for these criteria. Together, these factors accounted for 6% of the total score.
Days to Closing
You probably don’t want to wait 60 days for the lender to close your mortgage. A long closing time can be a problem, so we scored companies on a scale of zero to one based on how the average time it takes them to close a mortgage; this factor accounted for 5% of the total score.
Debt-to-Income Ratio
The portion of your monthly income that goes to paying back your debts is known as your debt-to-income ratio. Different loan types and different lenders have different DTI requirements, so comparing lenders by this factor can be useful. We gave companies higher scores for having lower DTI ratio requirements for conventional loans; this criterion accounted for 1% of the total score.
Choosing the Best Mortgage Lender for You
How do you find the right mortgage lender? There’s no shortcut to exploring several companies and comparing the offers you get. A home is likely to be the most expensive thing you ever buy, so taking the time to check your options and find the best rate can pay off. Start your search by looking at the lenders that rose to the top based on our methodology, with our picks for the best mortgage lenders available today. Prior to joining the The Balance team, Hannah served as a lead researcher for Fortune 500 companies and multinational biotech companies including Pfizer, Johnson & Johnson, and Takeda, where she studied user behaviors using eye-tracking, spatial tracking, and force sensors. Her experience leading rigorous studies for FDA reviews shaped her standard of research integrity which guides her work at The Balance. In her spare time, she enjoys playing the keyboard and reading nonfiction.
