Top Online Mortgage Lenders for January 2025

The best online mortgage lenders of January 2025

These days, every mortgage lender with a national profile has an online presence. Most, if not all, allow you to start a home loan application online too. However, only a few have grown their mortgage lending business organically by leveraging technology and establishing early-mover status as online lenders.

Yahoo Finance has completed due diligence on over 40 nationally recognized mortgage lenders and honed the list of the best online lenders to just a handful.

The Yahoo view: Better proudly plants a flag as a “100% online” mortgage lender and earns our top spot due to a combination of low interest rates and lower total loan costs than its web competitors.

Stars: 4.00

Read our full Better Mortgage review

Key benefits

• Better offers a full menu of conventional and government loans for home buying and refinancing.

• A home equity line of credit and a cash-out refi give you access to your house’s cash value.

• In a Yahoo Finance analysis of 2023 HMDA data, Better offered well-below-median interest rates and below-median loan costs. That’s a valuable combination.

• With its “One Day mortgage,” you can submit your financial information and receive a loan commitment within 24 hours.

Need to know

• On the day we checked, published mortgage rates were lowered with more than two discount points. Keep this in mind when comparing Better’s interest rates with rates from other lenders.

• In an effort to respond to customers more quickly, some of your inquiries may be handled by “Betsy,” an AI voice-based assistant.

Learn more: What are mortgage discount points, and should you pay for them?

The Yahoo view: In 2015, Rate (previously Guaranteed Rate) claimed to offer the “world’s first digital mortgage.” Now, it provides expanded loan eligibility with non-qualified mortgages.

Stars: 3.80

Read our full Rate (Guaranteed Rate) mortgage review

Key benefits

• Offers non-qualified mortgages for borrowers looking to use alternative credit data in their applications, such as bank statements or pay stubs, and those seeking a home loan with interest-only payments.

• Compete with cash buyers by using Rate’s PowerBid Approval. This service speeds up the preapproval process by verifying your financial information quickly and even gives you 90-day house-hunting flexibility.

• Rate earns our highest rating for Affordability, which measures loan options and the availability of down payment assistance.

Need to know

• Sample mortgage rates come with some stiff credit stipulations. Don’t love a rate until it’s locked.

• In 2023, Rate offered a lower-than-average interest rate but loan costs of nearly $6,500 — close to the industry average.

Read more: Non-qualified mortgages — How a non-QM loan can help you buy a home

loanDepot

The Yahoo view: loanDepot works to deepen its relationship with customers by offering cash incentives to use associated real estate agents.

Stars: 3.40

Read our full loanDepot mortgage review

Key benefits

• The “mellohome” program offers cash bonuses if you buy or sell your home using a real estate agent affiliated with loanDepot.

• The lender guarantees to close a loan on time or pay both the buyer and seller $1,000.

• Other home buyer benefits include discounts on security systems, moving services, and smart home products.

Need to know

• Sample mortgage rates are not provided on loanDepot’s website. You’ll have to call or submit a contact form to get an idea of the rate you might earn.

• Garners a below-average rating for customer service, according to the latest J.D. Power Mortgage Origination Satisfaction Study.

The Yahoo view: Ally is a leading online bank that touts a 100-year history. How does that work? It began as the in-house loan provider for GM vehicles. Today, Ally is a formidable mortgage lender worth considering.

Stars: 3.40

Read our full Ally Bank mortgage review

Key benefits

• Ally earns our highest rating for rate transparency. When you’re shopping mortgage rates, you’ll appreciate the ease of getting something close to reality.

• According to our analysis of 2023 loan data, Ally offered lower-than-median interest rates and total loan costs.

• First-time home buyers will appreciate an extensive selection of educational resources.

Need to know

• Don’t get confused: The Ally preapproval process is managed by Better Mortgage. But Ally is still your lender.

• Ally doesn’t offer government loans, including FHA, VA, or USDA loans.

Read more: Conventional vs. FHA loans for home buyers

The Yahoo view: Rocket Mortgage brought online home loan lending to the masses. Today, it continues to innovate with mortgage offerings such as a very-low-down-payment conventional loan.

Stars: 3.06

Read our full Rocket Mortgage review

Key benefits

• The One+ mortgage program utilizes a grant to reduce your down payment to 1%. Income and maximum benefit limits apply.

• A mortgage buydown program can temporarily reduce your interest rate for the first two years.

• Closing cost assistance is available to first-time home buyers in 21 US cities.

Need to know

• Its J.D. Power customer satisfaction score has fallen in the past couple of years, but Rocket still ranks above average.

• A recent Consumer Financial Protection Bureau lawsuit accused sister company Rocket Homes of paying real estate agents to steer mortgages to Rocket Mortgage. Rocket Homes denied the allegation and said it would challenge the lawsuit.

Dig deeper: How to buy down your mortgage interest rate

We carefully considered the following mortgage lenders for our best-of list, but they weren’t quite as strong as our top picks. Remember that many of these lenders offer online services — even if they didn’t originate as online lenders — so you can still complete most (if not all) of the application process digitally should you choose one of these companies.

Getting a home loan online is much like getting a mortgage in person. In either case, there’s lots of paperwork, but you’ll upload it instead of handing it over. If you’re technically savvy, things may go quicker online — mainly because you might be able to exchange documents faster. But getting an online mortgage is still not click-to-buy Amazon fast. The final loan approval process, called underwriting, is the same and is likely to take a couple of weeks.

Learn more: How the mortgage underwriting process works

Comparing online lenders is much like shopping for any big-ticket purchase:

• You will want to compare multiple lenders by getting preapproval offers to find the best fit.

• Shop interest rates and loan costs with side-by-side comparisons of your loan estimates.

• Look for “junk fees” (such as origination and application charges) and discount points you didn’t realize were added to the loan.

• Pay special attention to the annual percentage rate, which includes both the interest rate and fees.

Dig deeper: APR vs. interest rate — What you need to know when mortgage shopping

You have many choices of where to get a home loan and online is certainly among the best. However, you don’t want to exclude shopping at a brick-and-mortar lender. Banks, credit unions, mortgage companies, and brokers are all worthy of consideration.

For example, your daily bank may offer interest rate concessions or fee discounts to existing customers. Credit unions are often low-tech but high-touch when it comes to customer service.

There is great power in introducing a little competition into the mix.

Of the over 40 national lenders we have considered, Better Mortgage is the highest-rated online lender with 4 out of 5 stars. Better gets high marks in every category we consider, except for rate transparency. And that’s because Better reduces their advertised mortgage rates with more than two discount points. If you didn’t notice that, you might think Better’s rates are noticeably lower than a lender that doesn’t embed the added cost of discount points into their rates.

Of the banks Yahoo Finance has reviewed, Chase, TD Bank, and Truist are the highest-rated — each earning 4 out of 5 stars. And one credit union topped them all: Navy Federal Credit Union with our highest rating of 4.20 stars.

Based on loan volume measured by 2023 HMDA data, Rocket Mortgage is the No. 1 mortgage lender in America.

Yahoo Finance considers Better to be the best choice overall for an online mortgage. However, we also urge borrowers to consider two or three lenders before making a final decision. Your best choice may be another provider entirely.

In Yahoo Finance’s analysis of HMDA data, two online lenders in our best-of list had the lowest interest rates: Better and loanDepot. Both offered much-lower-than-median mortgage rates to borrowers in 2023.

Methodology:

Yahoo Finance reviews and scores mortgage lenders with quintile scoring in five primary categories: 1) Interest rates. Using 2023 Home Mortgage Disclosure Act data comprised of 10 million home loan applications, we score mortgage lenders on issued mortgage rates below or above the annual median of reporting lenders. 2) Affordability. A measure of loan product availability and the willingness of a lender to offer government-backed loans, low down payments, down payment assistance, and consideration of nontraditional credit. 3) Loan costs. HMDA data is again analyzed, and lenders are rated based on total loan costs compared to the annual median. 4) Rate transparency. The ability of a website user to obtain a mortgage interest rate estimate. We score lenders based on whether rates are enhanced with discount points or high credit score requirements, disclaimers revealing rate assumptions, sample advertised rates, and whether adjustable or no discount point rate estimates are available. 5) Online features. An analysis of the educational material, calculators, and additional resources available to users.

Review of Nationwide Multistate Licensing System (NMLS) data on regulatory actions can trigger a penalty to the score of any lender with a consumer mortgage-related administrative or enforcement action within the past five years.

Advertisers or sponsorships do not influence ratings.

Editorial disclosure for mortgages:

The information in this article has not been reviewed or approved by any advertiser. The details on financial products, including interest rates and fees, are accurate as of the publish date. All products or services are presented without warranty. Check the lender’s website for the most current information. This site doesn’t include all currently available offers.

This article was edited by Laura Grace Tarpley.

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