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It seems like practically every big-name mortgage lender has an online presence. You can shop for mortgage types and interest rates on their websites, and you may even be able to start the application process digitally.
However, very few lenders started out as online companies and grew their mortgage business organically. A handful of online mortgage lenders have leveraged technology to establish themselves as primarily 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 Finance 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.
Read our full Rate (Guaranteed Rate) mortgage review
Key benefits
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Offers non-qualified mortgages for borrowers looking to use alternative credit data in their application, such as bank statements or pay stubs — and those seeking a home loan with interest-only payments.
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Rate earns our highest rating for Affordability, which measures loan options and the availability of down payment assistance.
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It has also been awarded 5 stars for its online learning resources.
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Allows you to 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.
Need to know
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Sample mortgage rates come with some stiff credit stipulations. Don’t fall in love with a rate until it’s locked.
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In 2024, Rate offered higher-than-average interest rates and loan costs to borrowers.
The Yahoo Finance view: Better proudly plants a flag as a “100% online” mortgage lender and the “first AI-powered mortgage.” It stands out for quick loan closings.
Read our full Better Mortgage review
Key benefits
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With its “One Day mortgage,” you can submit your financial information and receive a loan commitment within 24 hours. Better also claims to close 12 days faster than the industry average.
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Better offers a full menu of conventional and government loans for home buying and refinancing.
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A home equity line of credit and a cash-out refi give you access to your house’s cash value.
Need to know
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In an effort to respond to customers more quickly, some of your inquiries may be handled by “Betsy,” an AI voice-based assistant.
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In a Yahoo Finance analysis of 2024 HMDA data, Better offered near-median interest rates and loan costs.
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On the day we checked, published mortgage rates were lowered by using more than two discount points. Keep this in mind when comparing Better’s interest rates with rates from other lenders.
The Yahoo Finance 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.
Read our full Rocket Mortgage review
Key benefits
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Closing costs assistance is available to first-time home buyers in 21 U.S. cities.
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The One+ mortgage program utilizes a grant to reduce your down payment to 1%. Income and maximum benefit limits apply.
Need to know
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Its J.D. Power customer satisfaction score has fallen in the past couple of years, but Rocket still ranks above average.
Learn more: Rocket Mortgage customers earn up to 5% cash back with the Rocket Visa Signature Card
The Yahoo Finance view: We all know Zillow for its home listings platform. Now, it’s a growing mortgage provider combining a lender marketplace with its own home loans division.
Read our full Zillow Home Loans review
Key benefits
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Zillow Home Loans earns our highest 5-star rating in the Online Resources category, including an affordability tool that updates with changes to your credit score and real-time mortgage rates.
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It also offers a down payment assistance program finder.
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Plenty of educational resources, including articles and calculators.
Need to know
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Zillow Home Loan interest rates and loan costs were higher than average for mortgages closed in 2024.
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Does not originate loans in New York.
Dig deeper: How to buy down your mortgage interest rate
The Yahoo Finance view: loanDepot works to deepen its relationship with customers by offering cash incentives to use associated real estate agents.
Read our full loanDepot mortgage review
Key benefits
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The “mellohome” program offers cash bonuses if you buy or sell your home using a real estate agent affiliated with loanDepot.
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The lender guarantees to close a loan on time or pay both the buyer and seller $1,000.
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Other home-buyer benefits include discounts on security systems, moving services, and smart home products.
Need to know
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Garners a below-average rating for customer service, according to the latest J.D. Power Mortgage Origination Satisfaction Study.
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LoanDepot’s website does not provide sample mortgage rates. You’ll have to call or submit a contact form to get an idea of the rate you might earn.
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 weren’t established originally 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 both cases, 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.
Comparing online lenders is much like shopping for any big-ticket purchase. Here are tips for choosing a mortgage lender:
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Compare multiple lenders by getting preapproval offers to find the best fit.
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Shop interest rates and loan costs with side-by-side comparisons of your Loan Estimates.
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Look for “junk fees” (such as origination and application charges) and discount points you didn’t realize were added to the loan.
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Pay special attention to the mortgage loan annual percentage rate (APR), which includes both the interest rate and fees.
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 mortgage 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, Rate is the highest-rated online lender with 3.60 out of 5 stars. Rate earns our top score for affordability — a measure of loan options — and online resources.
Of the banks Yahoo Finance has reviewed, Bank of America, Chase, and PNC Bank are the highest-rated — each earning 4 out of 5 stars.
Based on loan volume measured by 2024 HMDA data, Rocket Mortgage is the number one mortgage lender in America.
Yahoo Finance considers Rate to be the best choice overall for an online mortgage. However, we urge borrowers to consider two or three lenders before making a final decision. Your best choice may be another provider entirely.
Among the online lenders that made our best-of list, Better and Rocket scored highest for their interest rate offerings. But overall, in Yahoo Finance’s analysis of HMDA data, the online lenders on our list offered mortgage rates that were average or worse in 2024. Generally, we found the best interest rates to be offered by some banks and credit unions, such as Bank of America and Navy Federal Credit Union.
Methodology:
Yahoo Finance reviews and scores mortgage lenders with quintile scoring in five primary categories: 1) Interest rates. Using 2024 Home Mortgage Disclosure Act data from almost 5,000 mortgage companies, 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.