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Best Online Mortgage Lenders for February 2024 – THE CIALISAN WORLD 2024
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Best Online Mortgage Lenders for February 2024

For the last two years borrowers have watched interest rates on mortgage loans steadily climb higher and higher from their previous all-time low. As we can no longer enjoy the under 3% rates of 2020, it’s important to shop around and find the best possible terms if you’re looking to buy or refinance a home.

Here’s a look at some of the best online mortgage lenders right now and how you can apply for a new loan from the comfort of your home.

Online mortgage lenders compared 2024

Comparing interest rates for different mortgage types

Conventional, ARM, FHA, VA, Jumbo, and USDA

ARM; fixed rate 10, 20, 30 years;  1 year interest-only Bridge; up to 23 months Lot/Land

Buying a new home with your current home’s equity

Conventional, ARM, and Jumbo

Conventional, ARM, FHA, VA, and Jumbo

One-day mortgage approval

Conventional, ARM, FHA, and Jumbo

Fixed rate 10, 20, and 30 years; ARM five years and six months, seven years and six months, and 10 years and six months

Conventional, ARM, FHA, VA, and Jumbo

Conventional, ARM, FHA, VA, Jumbo, and USDA

Instant online preapproval

Conventional, ARM, FHA, VA, and Jumbo

More mortgage lenders

Our recommendations

Best for flexible repayment terms: Warp Speed Mortgage

Why we recommend it: Warp Speed Mortgage offers conventional, ARM, FHA, USDA, VA, and jumbo loans with repayment terms ranging from five to 30 years in length. While not all products are available in all 50 states, eligible borrowers can rate-shop for an in-house home loan online and take advantage of WarpSpeed’s 14-day closing guarantee.

You’ll be hard-pressed to find much information on the company’s website. However, mortgage experts are available by phone to help answer your questions or start the home-purchase or refinance-loan process.

Pros:

  • Loan repayment terms from five to 30 years.
  • Multiple loan options available.
  • 14-day closing guarantee.

Cons:

  • Limited information online.
  • No option for in-person loan processing.
  • Products not available in all states.

Best for buying a new home with your current home’s equity: Calque

Why we recommend it: Rather than rushing to sell your current home at the same time as (or even before) buying a new home—or juggling two mortgage payments at once—a Trade-In Mortgage from a Calque partner lender can help you use your current property’s equity to buy a new home. You’re offered a purchase price guarantee and if your home doesn’t sell within 120 days of listing, Calque will buy it from you at the agreed price.

Until your old home sells, a home equity loan is used to fund the mortgage payments. Once your original home has sold, your new lender will keep 20% of your new home’s purchase price as the down payment. While Calque lenders specialize in this type of loan, you will need to look elsewhere if you want a conventional mortgage loan, FHA loan, VA loan, or USDA loan.

Pros:

  • Makes it easy to buy a new home without selling your current home first.
  • Purchase price guarantee offered in 3 to 5 days.
  • Avoid paying two mortgages at once.

Cons:

  • Trade-In Loans are the only product available.
  • Loans are offered by partner lenders, not in-house.
  • Requires a traditional 20% down arrangement.

Best for no lender fees: Ally

Why we recommend it: If you’re looking to save money on lender fees when buying a home, an Ally home mortgage loan could be the answer. Ally charges no application, origination, processing, or underwriting fees to borrowers, and you can be pre-approved for your new home loan in about three minutes online. Ally offers fixed-rate, ARM, and jumbo loans for up to $4 million, and even works with the FannieMae HomeReady Mortgage Program, which allows eligible borrowers to put down as little as 3% on their new home purchase.

Since Ally is an online bank, there are no branch locations to visit if you want help originating your new loan. You’ll also find that your loan options are limited to the three loan types mentioned above: Ally does not offer home equity products (including home equity loans or HELOCs) nor does this financial institution originate VA loans, FHA loans, or USDA home loans.

Pros:

  • No lender fees.
  • Down payment as low as 3%.
  • Online pre-approval in minutes.

Cons:

  • No FHA, VA, or USDA loans available.
  • No home equity loans or HELOCs.
  • All loans are processed online; no branch locations available.

Best for low credit score: Rocket Mortgage

Why we recommend it: If you have a fair credit score or lower, you may find it difficult to obtain a competitive home mortgage loan through certain lenders. Rocket Mortgage, however, is the largest FHA lender in the country and offers loans to borrowers with credit scores of 580 or higher. It has an entirely online loan process and funds home purchase loans in all 50 states as well as DC.

Origination fees can be higher with Rocket Mortgage than some other lenders, and there are no in-person services available. If you’re looking to use the equity in your existing home, you’ll also need to shop around, as Rocket Mortgage doesn’t offer home equity loans or lines of credit.

Pros:

  • Credit scores as low as 580 accepted.
  • Process is 100% online.
  • Available nationwide.

Cons:

  • Origination fees can be higher than average.
  • No in-person agents or loan representatives.
  • No home equity products.

Best for one-day mortgage approval: Better

Why we recommend it: Better is a direct online home mortgage lender offering home purchase loans with approval as fast as one day. The process is entirely online and allows borrowers to lock in rates and get a loan commitment letter fast. Better offers home purchase loans as well as refinance loans and HELOCs for existing homeowners, even on secondary and investment properties.

Better doesn’t offer any in-person loan services and not all types of home loans are available. While loan officers are not commission-based and fees are transparent, costs can be a bit higher in the end than with other lenders.

Pros:

  • Commitment letters in as little as one day.
  • Purchase, refinance, and HELOC loans available.
  • Competitive interest rates.

Cons:

  • Not all types of loans available.
  • Fees may be higher on average.
  • No in-person loan services.

Best for mortgage rate discounts: Mr. Cooper

Why we recommend it: If you’re looking to lower your mortgage loan rates, Mr. Cooper not only has competitive rates but also offers a 1% mortgage rate buy-down in addition to other programs and promotions. You can get an online mortgage loan pre-approval in just minutes, and even rest easy with Mr. Cooper’s Close On-Time Guarantee. If your loan doesn’t close on time (and it’s the lender’s fault), Mr. Cooper will pay your first mortgage bill.

Detailed fee information can be difficult to find online, and total fees may be higher than average when all is said and done. While Mr. Cooper does offer online rate quotes and terms for potential borrowers, you will likely still need to call or email to get a personalized quote.

Pros:

  • Many rate promotions and programs available.
  • Online pre-approval letter available in just minutes.
  • Guaranteed on-time closing.

Cons:

  • Personalized rates available only by phone or email.
  • Total fees may be higher than average.
  • No home equity loans or lines of credit.

Best for loan options: PNC Bank

Why we recommend it: Whether you’re looking for a conventional fixed-rate home mortgage loan, a jumbo or adjustable-rate loan, or a government-backed product such as an FHA, VA, or USDA loan, PNC can help. These mortgage loans are available in all 50 states with an online or in-person process for most borrowers. The bank has high customer satisfaction and industry ratings through JD Power and Zillow.

Though PNC Bank offers many different home mortgage loans, you won’t be able to get a home equity loan or home renovation mortgage loan. Obtaining that loan can be limiting, too, depending on your location. Some borrowers won’t have access to in-person loan services while others may prefer an online process, but will quickly find that it isn’t entirely digital.

Pros:

  • Conventional, ARM, FHA, VA, USDA, and jumbo loans offered.
  • Available nationwide.
  • High customer satisfaction ratings.

Cons:

  • In-person services only available in certain states.
  • No renovation or home equity loans.
  • Even the online loan process isn’t 100% digital.

Best for instant online pre-approval: LoanDepot

Why we recommend it: LoanDepot is a mortgage lender offering both an in-person and online mortgage experience for borrowers considering conventional, ARM, FHA, VA, or jumbo loans. LoanDepot also offers refinance and home equity loans, and the ability to get pre-approved online instantly.

While the online process is fast, you may still need to speak with an agent by phone, email, or in-person to finalize your loan quote. You’ll also find that online information regarding LoanDepot loan options can be limited, though there are more than 200 brick-and-mortar branches you can visit and a weekday customer service line if you have questions.

Pros:

  • Get pre-approved online instantly.
  • Purchase, refinance, and home equity loan options.
  • High customer satisfaction ratings.

Cons:

  • Most borrowers will need to speak with an agent to proceed.
  • Online information is limited.
  • Origination fees may be higher than average.

How to select the best online mortgage lender for you

If you’re thinking about buying a new home—or even refinancing a home you already own—you’ll want to shop around a bit first to find the lender that suits you best. Here are some things to consider when trying to select the best online mortgage lender for you and your housing needs.

How long does it take to get preapproved?

Depending on the lender it may take just a few minutes to get preapproved online, or the process could require a few days’ time. Many online mortgage lenders do offer a quick preapproval process, though, so you have a better idea of what you can afford and the sort of loan for which you’ll get approved in the end. This will help you begin shopping for the right property for your budget. What’s more, having a preapproval letter can make you a more enticing buyer in a competitive market.

What are the borrower requirements?

Each lender will set its own mortgage loan requirements for borrowers, which may include factors such as a minimum credit score and maximum debt-to-income (DTI) ratio. If you don’t meet these requirements, you may be limited in the type of loan or loan amount for which you qualify. In some cases you may even be ineligible to take out a mortgage loan from that lender or will need to add a creditworthy cosigner to qualify.

What sort of loans are offered?

When it comes to mortgage loans, there are conventional loans with fixed and variable rates, adjustable-rate mortgages (ARMs), jumbo loans, Veterans Affairs (VA) loans, Federal Housing Administration (FHA) loans, and U.S. Department of Agriculture (USDA) loans. The right loan for you depends on the property you’re buying, the purchase price, your personal and credit factors, your profession, how much you can afford to put down, where you’re buying a home, and whether it’s your first property purchase. While most online mortgage lenders offer conventional and ARM loans, you may need to shop around a bit if you’re looking for a government product such as an FHA, a VA, or a USDA loan.

Does an online mortgage have better rates?

Some online mortgage lenders offer very competitive interest rates. As they don’t have brick-and-mortar branch locations, they may have lower overhead costs that they can pass on to borrowers. Shopping for a mortgage loan online also makes it easier for you to compare rates and loan terms quickly, so you can find the best loan for you.

In some cases you may still get a better rate by applying through a traditional lender or a financial institution with which you have an existing relationship (such as your current bank or credit union). However, it’s always wise to shop around and compare rates from multiple lender options.

More about online mortgage lenders

Online mortgage lenders are a relatively new concept. In fact, the very first entirely online mortgage lender experience came from Rocket Mortgage, which introduced its end-to-end online product in 2015. If you’re not yet familiar with these types of lenders, here’s what you need to know.

What is an online mortgage?

An online mortgage is a home mortgage loan issued through an online-based lender. These loans generally provide borrowers with an entirely online experience from start to finish: You can get preapproved (sometimes in just minutes), upload requested documents, track underwriting progress, sign documents, communicate with your loan officer, and review mortgage paperwork from wherever you have internet access. In most cases signatures can be obtained digitally, meaning you won’t even need to print out a single piece of paper through the loan closing.

How does an online mortgage work?

With an online mortgage you are able to browse available loan products and terms online through a lender’s website or app. You can then apply for a new loan from your computer or mobile device, often getting preapproved in a short amount of time. Once you’ve selected the loan and terms that work best for you, you can begin shopping for your new home and let the lender know once you’ve had a purchase offer accepted.

With an online mortgage you’ll be able to complete the process digitally from start to finish. This includes your application, documentation, loan selection, and more. However, you may still need to sign your final loan documents with “wet ink,” meaning putting pen to paper with a notary. These days online lenders will often send a mobile notary to your home, though, so the process is as simple and pain free as possible.

Pros and cons of online mortgage lenders

There are benefits and downsides to working with an online mortgage lender.

Pros

  • Easily and quickly shop for rates with various lenders without leaving home.
  • Upload documents on the go.
  • Compare loan options and rates, which may be more competitive than traditional lenders.

Cons

  • Customer service may be limited (and many platforms are run, at least partially, with the help of AI).
  • You won’t have a pre-existing relationship with a loan officer or the financial institution.
  • The rates you’re initially offered—especially with a preapproval—aren’t guaranteed.

How to prepare for the online mortgage application process

  • Get your credit in order. To qualify for a home mortgage loan and get the best possible terms (including a competitive interest rate), you’ll need to have a good credit score and history. This means preparing your credit ahead of time by making on-time payments each month, lowering existing balances, and not opening any new accounts. It’s also wise to check your credit before you begin applying for mortgages, so you can spot and correct any errors on your credit report.
  • Have all of your documentation gathered. You’ll be asked for a lot of documentation throughout the mortgage process. This might include providing a lender with your most recent pay stubs, tax returns, proof of identity, bank statements, proof of down payment, and more. If you have all of this ready, it’ll make the process go smoother and faster.
  • Know what you can afford. While you won’t know exactly what interest rate you’ll qualify for before applying, you can get an idea of what your current budget will allow. Spend some time going over your household finances to calculate how much you can afford to put down and what you can afford to pay monthly on a new home, including insurance and taxes. This will help you find the best loan terms for your situation.
  • Make sure down payment funds are seasoned. A lender will want to see that your down payment funds are seasoned, meaning they have been in your account for a period of time. This is usually about three months, though it may vary by lender. If your funds are coming as a gift or cash deposit, you’ll need to plan ahead.
  • Be prepared to rate-shop. Finding the best mortgage loan for you often means shopping around with multiple lenders. This can help you compare terms and interest rates and allow you to choose the one that best meets your needs.

Just be sure to plan ahead, shop carefully, and pick an experienced lender with the mortgage options and level of services that fit your needs and your comfort level. And don’t forget to check with your own bank or credit union, just in case an existing relationship can yield the best deal for you.

Frequently asked questions (FAQs)

Can you get a mortgage completely online?

You can apply, qualify for, and fully originate a mortgage loan online in many cases. When working with many of the best mortgage lenders, most (if not all) of your documents can be submitted online and uploaded through a secure portal. You may need to sign your closing documents in person, in which case a mobile notary can often be sent to your location, though sometimes you can submit a digital signature online.

Are online mortgage lenders safe?

Online mortgage lenders can be just as safe as brick-and-mortar lenders, as long as you choose an experienced one with a history of secure mortgage originations. Submitting an application online can also be as safe as, or safer than, submitting a paper mortgage application, as your data is often encrypted or maintained behind a secure portal.

Who is the number-one mortgage lender in America?

According to recent Home Mortgage Disclosure Act (HMDA) data (see page 65), Rocket Mortgage is the top mortgage lender in the United States, originating about 464,000 home mortgage loans in 2022. United Wholesale Mortgage (formerly United Shore Financial Services LLC) was next in line, with about 347,000 originated mortgages that same year.


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