We evaluated several lenders for affordability, accessibility, and customer experience to determine the best online mortgage lenders. The best online mortgage lenders in 2022 are accessible in all or most U.S. states.
Better.com
An online mortgage lender with a license in 49 states and Washington, D.C. is better.com.
Purchase-and-refinance, conventional, jumbo, and FHA loans are available.
What you should know: Better.com offers a three-minute online preapproval process, chat support, and the ability to verify your loan status and add documents and e-sign documents. Online resources provided by the lender for borrowers include a glossary of homeownership and mortgage terms, calculators for affordability, amortization, and refinancing, and a hub for resources. However, some may find Better.com’s lack of VA or USDA loans limiting.
Bank Ally
In 43 states and Washington, D.C., Ally Bank is a bank and lender that offers online goods and services, including mortgages.
Purchase-and-refinance, conventional, and jumbo loans are available.
What you should know: Ally Bank offers online helpful learning resources and daily mortgage rates are promoted on its website, so potential customers can compare options. Borrowers can manage their mortgages from their phones using the Ally app. Check your eligibility first because the bank isn’t licensed in some states (yet), and it doesn’t provide government-backed loans (FHA, VA, or USDA).
AmeriSave Mortgage Corporation
A licensed online mortgage lender in 49 states and Washington, D.C., is AmeriSave Mortgage Corporation.
Purchase-and-refinance, conventional, jumbo, FHA, VA, and USDA loans are available.
What you should know: AmeriSave Mortgage Corporation is an online mortgage lender that provides three-minute online prequalification and other valuable online services like chat support, e-signature/file upload, and loan status tracking. Borrowers can use the lender’s website to determine whether to buy or rent, how much their monthly mortgage payment is, or how much money they might save if they refinance, and to access a Mortgage Knowledge Center that is filled with informative articles and videos.
Lower
Lower is authorized in 42 states and Washington, D.C.
Purchase-and-refinance, conventional, jumbo, FHA, VA, and USDA loans are available.
What you should know: With Lower, applying for a loan and receiving a preapproval or prequalification is both a simple and completely digital process. One standout: The lender’s app offers a dollar-for-dollar matching program through an interest-bearing savings account, up to $500, for borrowers saving for a down payment. Additionally, the app has a credit and interest rate tracker so that consumers can monitor their credit rating and current mortgage rates as they save money.
LowRates.com
LowRates.com has licenses in 48 states, Washington, D.C., and Puerto Rico.
Purchase-and-refinance, conventional, jumbo, FHA, VA, and USDA loans are available.
What you should know: LowRates.com guarantees market-competitive rates, as its name suggests. Borrowers can apply for a loan on the LowRates website and expect full underwriting to be completed in less than 24 hours, thanks to its TRU Approval platform. (Borrowers cannot obtain preapproval or prequalification in this manner.) There are also calculators on the lender’s website and, in some circumstances, the option to e-sign documents.
SoFi
Mortgages are one of the financial services offered by SoFi and are legal in 47 states and Washington, D.C.
Purchase-and-refinance, conventional, and jumbo loans are available.
What you should know: Since SoFi is a personal finance company, members can access banking and investing services in addition to home loans and financing for various purposes (such as a car or wedding). Notably, the SoFi app is among the top 100 financial apps available in the Apple Store. Borrowers can access a Home Loan Help Center on the SoFi website for informational guides and insights. However, there is one drawback: SoFi, like some other online lenders, does not offer FHA, VA, or USDA loans.
Wyndham Capital Mortgage
Wyndham Capital Mortgage is an online mortgage lender with permits in 47 states and Washington, D.C.
Purchase-and-refinance, conventional, jumbo, FHA, VA, and USDA loans are available.
Things to know The e-closing process offered by Wyndham Capital Mortgage is exceptional, allowing borrowers to close from any location up to 15% faster than the industry standard time frame. Additionally, borrowers can quickly generate a preapproval letter tailored to the property from their phone using the lender’s Priority Purchase Program. Additionally, unlike other online lenders, Wyndham has been in operation for 20 years.
What is an Online Mortgage?
A home loan originated entirely online, with a digital process from application to closing, or a brick-and-mortar business with physical locations and online services is known as an online mortgage.
A digital mortgage platform has been added to the capabilities of many banks in recent years, but non-bank institutions also originate the vast majority of mortgages. Banks include well-known names like Bank of America and Wells Fargo, while non-bank institutions include businesses like loanDepot and Rocket Mortgage.
Digital mortgage brokers, like Morty and Sage, who help borrowers find loan products and rates and assist them throughout the lending process, are another option for borrowers in addition to digital lenders who are based online or have a hybrid online physical presence. A broker can be an excellent place to start for borrowers who have never bought or refinanced a home.
How Does an Online Mortgage Work?
With an online mortgage, all or many of the lending process’s steps can be finished digitally using an app or online portal. These actions could involve:
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- Prequalification or preapproval
- Application and upload of documents
- Processing and underwriting of loans
- Closing (sometimes called an e-closing)
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Online mortgages tend to have lower rates and overall costs due to the simplification of these steps and, in the case of a digital lender, the absence of offices and overhead, which can save borrowers thousands of dollars.
How to Pick the Best Online Mortgage Lender
A lot of borrowers are drawn to online mortgage lenders simply because of their convenience, effectiveness, and speed because obtaining financing for a home is a process. When looking for the best online mortgage lender, these are crucial factors to consider. Still, it’s also crucial to compare costs for your particular situation and spend time reading mortgage lender reviews to understand what to anticipate from the online experience. Compare various online lenders and look for:
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- Loan products they provide
- Requisites for credit and down payment
- Fees for applications and origination
- Rate-locking and other advantages
- What kinds of assistance are offered
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Pros and Cons of Online Mortgages
Pros
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- Due to low overhead, mortgage rates and fees are lower
- Online preapproval or prequalification with shorter timelines, frequently in minutes overall
- Instantaneous status updates
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Cons
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- Can’t always reach a live person for assistance or questions
- Rates aren’t always available upfront; preapproval may be necessary
- Probability of fraud or a breach in a fully digital process
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Featured Image: Pexels © Mikhail Nilov
