Best online mortgage lenders of October 2023

Getting a mortgage used to be a tedious and painstaking process. You’d have to go to a bank or mortgage company, sit across a desk from a loan officer, and — by hand — fill out pages upon pages of application forms (not to mention submit physical copies of bank statements, tax returns, and dozens of other documents as well.)

Now, thanks to modern technology, getting a mortgage is as easy as opening a laptop and logging onto your local WiFi network.

It’s true: Most mortgage companies offer fully online mortgages at this point — mortgages you can apply for with just a single online form and a few uploaded documents. 

Still, just because most companies offer them doesn’t mean they’re all the same. Want to make sure you’re using the right lender for your specific needs? These are the best online mortgage lenders to consider.

If you’re buying a home in a competitive market, being able to act fast — before other buyers can step in and snag that dream home — is critical. Ally can help you there. The online bank offers preapprovals in just three minutes, and it closes on loans up to 10 days faster than the average lender. 

• Quick preapprovals 
• Fast closing times
• No lender-side fees

• No FHA, VA, or USDA loans
• Low customer rating on Trustpilot
• No home equity loans or HELOCs

If you need some help along the way, Rocket Mortgage may be your best choice. The online lender offers phone help from 7 a.m. to 7 p.m. on weekdays and live chat assistance seven days a week. It also has a wide network of loan officers across the country and is one of the best-known names in the mortgage business.

• Readily available customer service
• High customer ratings on Trustpilot
• Offers FHA, VA, jumbo, and conventional mortgages
• Lots of incentives and closing cost programs

If you want a hybrid experience — one with a mix of both online and in-person (or over-the-phone) steps — then PNC Bank could be a good option. The bank offers online preapproval in just minutes, and its Home Insight tool guides you through the entire homebuying process.

• Readily available customer service
• Many loan options, including conventional, FHA, VA, USDA, and medical professional mortgages
• Lots of online tools and learning resources

• Not available in all 50 states
• Can’t complete the entire loan process online

Better.com is an online mortgage lender that relies heavily on technology, thereby reducing overhead costs and the fees passed on to homebuyers. The lender charges no origination or underwriting fees on its mortgages, and its interest rates are lower than the national average, too. Better even offers a one-day mortgage that lets you get a loan commitment and lock in a rate in just 24 hours.

• No origination or underwriting fees
• Offers conventional, VA, FHA, and jumbo loans
• Fast closing times
• Lower rates than national averages
• Good customer reviews on Trustpilot

• No USDA loans
• Only a “B” rating with the Better Business Bureau

For the biggest selection of mortgage loan types, look to Guaranteed Rate. The lender offers conventional, FHA, VA, and jumbo loans, as well as HELOCs and reverse mortgages. You can also choose between fixed- and adjustable-rate options. Guaranteed Rate also offers five-minute preapprovals via its mobile app.

• Offers conventional, VA, FHA, jumbo, and home renovation loans
• Fast preapprovals
• A+ rating with the Better Business Bureau

• No USDA loans
• Customer service is limited to business hours on weekdays

In addition to Better, another online lender that offers low fees is NBKC Bank. Rather than charging dozens of separate fees and line items, NBKC takes a flat-fee approach, requiring just a $250 payment for all lender-side services, including application, underwriting, processing, and origination. 

• Offers conventional, FHA, VA, and new construction loans
• Low fees
• High ratings on Trustpilot

• No USDA or jumbo loans
• Home equity loans are only available in the Kansas City metro area
• Customer service is limited to business hours

For self-employed buyers or those with non-traditional income, New American Funding is one of the best mortgage lenders out there — largely thanks to its non-QM loan program, which is flexible in how it evaluates income, credit, and other financial qualifications. New American also has loan programs for large loan amounts (jumbo loans), renovating fixer-uppers, building a home, and creating an accessory dwelling unit on an existing property.

• Lots of loan options for non-traditional borrowers
• Offers conventional, FHA, VA, USDA, non-QM, ADU, jumbo, and new construction loans
• A rating with the Better Business Bureau
• Can refinance within five years, with no fees

• No home equity loans or HELOCs
• Customer service is limited to business hours

Don’t want to deal with scanning or uploading a ton of documents? LoanDepot’s Mello Smartloan platform can help there. The tool streamlines the mortgage application process, allowing you to connect your application directly to employment portals, bank accounts, and more — saving you both time and hassle. Smartloan also uses a proprietary loan engine to recommend the best and most affordable loan options based on all your information. 

• Streamlined loan process
• Offers conventional, FHA, VA, USDA, jumbo, and renovation loans
• Good ratings on Trustpilot
• A+ rating with the Better Business Bureau

• No home equity loans 
• Customer service is limited to weekdays

For the most choices, look to Flagstar Bank, which offers your typical conventional, FHA, and VA loans, along with other, more specialized ones. There are loans for doctors, lawyers, and other highly trained professionals, loans for purchasing multiple properties at once, and loans for renovating a property that needs TLC. There are also location-specific home loan programs as well.

• Lots of loan options, including specialized loans for professionals, specific locations, and multiple properties 
• Readily available customer service
• Available in all 50 states

• Home equity loans and HELOCs aren’t available nationwide
• Poor reviews on Trustpilot

A mortgage is a type of loan that can be used to purchase a home or other piece of real estate. The lender covers the cost of the house — minus your down payment — and then you repay the balance back over time, plus interest.

Mortgage loans can last up to 30 years and may have fixed or variable interest rates. Fixed interest rate mortgages have a rate and payment that’s consistent for the entire loan term. Variable-rate ones have rates that fluctuate over time. 

The first step to getting a mortgage is to preapproval, which you can typically do online. You’ll then get a preapproval letter detailing how much you can borrow and at what interest rate. You can use this letter when submitting an offer on a house.

Financial experts usually recommend you follow the 28/36 rule, which says no more than 28% of your monthly pre-tax income should go toward housing costs and no more than 36% should go to debts in total (your combined mortgage, car payment, student loans, credit cards, etc.)

This means that if you bring in $5,000 per month, your mortgage payment should be no more than $1,400 and your total debts no more than $1,800.

Most experts think mortgage rates will drop in 2024 — but not significantly. Fannie Mae’s current projections have mortgage rates ranging from 6.3% to 6.8% next year, while the Mortgage Bankers Association predicts a slightly lower 5.4% to 6.1%. 

Where rates head will likely rely on the Federal Reserve’s moves. If the central bank can get the country’s inflation rate down to its 2% goal, it may let up on raising its federal funds rate (which usually means lower mortgage rates, too). If inflation doesn’t fall, however, the Fed may be forced to raise its rate once again — meaning mortgage rates could stay around their current levels or move up more. 

Editorial Disclosure: All articles are prepared by editorial staff and contributors. Opinions expressed therein are solely those of the editorial team and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in this article is accurate as of the date of the publish. Check the lender’s website for the most current information.

This article was originally published on SFGate.com and reviewed by Lauren Williamson, who serves as Financial and Home Services Editor for the Hearst E-Commerce team. Email her at [email protected].