Best mortgage lenders for bad credit in September 2024 (2024)

If you have bad credit, thehome-buying process can benerve-wracking. Luckily, there are lenders that will consider applicants with bad credit — or no credit at all.

CNBC Selecthas chosen the top lenders for borrowers with poor credit and evaluated each based on average rates, types of loans offered, minimum down payment, customer service and other factors. (See our methodology below.)

Who's this for?Rocket Mortgagestands out if you're seeking flexibility. While most lenders tend to require a minimum credit score of 620, Rocket Mortgage accepts applicants with credit scores as low as 580.

Standout benefits: Rocket Mortgage's Fresh Start program helps applicants boost their credit scores before applying. Eligible borrowers can put just 1% down with the Rocket ONE+ mortgage.

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Who's this for?Navy Federal Credit Union issues home loans to active-duty military, veterans and their families. Borrowers can apply with non-traditional credit sources, like proof of on-time rent and utility bill payments. Navy Federal will also consider the banking history of existing customers.

Standout benefits: Navy Federal's 1.00% origination fee can be waived if you opt for a 0.25% rate increase instead. The Military Choice mortgage is similar to a VA loan (no down payment or private mortgage insurance) but sellers can contribute up to 6% of the home's value toward closing costs.

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Who's this for?Citibank's HomeRun loan lets you put as little as 3% down without PMI. If you've already bought a house, you can use HomeRun to refinance your mortgage.

Standout benefits: Citi's Lender Paid Assistance program enables eligible borrowers to get up to $7,500 in closing-cost credits.

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Who's this for?Guild Mortgage will consider borrowers with no credit history, using proof of on-time payment of rent, insurance and utility bills instead.

Standout benefits: Guild's Zero Down mortgage combines a 3.5% FHA loan with a forgivable second mortgage to bring your down payment down to 0%. Borrowers can be approved with credit scores as low as 600.

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Who's this for?CrossCountry Mortgage boasts it can close most mortgages in as little as 21 days, about half the time lenders usually take.

Standout benefits: First-time buyers who meet income or location requirements can qualify for up to $6,500 in down payment assistance from CrossCountry.

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Rocket Mortgage, the largest home loan provider in the U.S., consistently scores above average on J.D. Power customer satisfaction surveys. Verified approval is available in as little as two hours, with an average closing time of 22 days.

Types of mortgage loans offered: Conventional, FHA, VA, jumbo, HomeReady and Home Possible, Rocket ONE+ mortgage

Minimum credit score: 580 for FHA, 620 for conventional

Minimum down payment: 0% for VA, 1% for Rocket ONE+; 3% for conventional, 3.5% for FHA

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Navy Federal Credit Union is the largest credit union in the country and the fourth-largest provider of VA loans. Membership is limited to active duty service members, veterans, Reservists, Department of Defense employees and their immediate family members.

Minimum credit score: Not disclosed. (Navy Federal considers non-traditional credit sources.)

Types of mortgage loans offered: Conventional, VA, Military Choice, Homebuyers Choice

Minimum down payment: 0% for VA loans, 5% for conventional loans

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Existing Citibankcustomers are eligible for a $500 closing credit or an interest rate discount, depending on their account balance. Unlike most preapprovals, Citibank's SureStart® agreement includes a "commitment to lend" so there are no surprises later.

Minimum credit score: Not disclosed.

Types of mortgage loans offered: Conventional, FHA, VA and jumbo loans

Minimum down payment: 0% for VA loans; 3% for conventional loans, 3.5% for FHA loans, 10% for jumbo

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Founded in San Diego in1960, Guild is licensed in all states except New York. Its Homebuyer Express guarantee ensures closing in 17 days or borrowers can receive $500 in closing costs (not available in Oregon). While Guild scored highly on JD Powers' 2023 mortgage originator survey, it was ranked near the bottom for mortgage servicing.

Types of mortgage loans offered: Conventional, FHA, VA, USDA, jumbo

Minimum credit score: 540 for FHA, 620 for conventional. (Guild also considers non-traditional credit sources.)

Minimum down payment: 0% for VA and Zero Down loans, 3% for conventional loans, 3.5% for FHA loans

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CrossCountry Mortgage issues home loans in all 50 states and the District of Columbia, and has over 600 branches for in-person service. It's routinely rated above average for both mortgage origination and servicing by J.D. Power and received an A+ from the Better Business Bureau.

Types of mortgage loans offered: Conventional, FHA, VA, USDA, jumbo,

Minimum credit score: 500 for FHA, 620 for conventional

Minimum down payment: 0% for VA, 3% for conventional, 3.5% for FHA

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Getting ready to apply for a mortgage? Polishing your credit is the first step.

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To determine which mortgage lenders are the best for bad credit,CNBC Selectanalyzed dozens of U.S. mortgages offered by online and brick-and-mortar banks, including large credit unions, that come with fixed-rate APRs and flexible loan amounts and terms to suit an array of financing needs.

When narrowing down and ranking the best mortgages, we focused on the following features:

• Fixed-rate APR:Variable rates can go up and down over the lifetime of your loan. With a fixed rate APR, you lock in an interest rate for the duration of the loan's term, which means your monthly payment won't vary, making your budget easier to plan.
• Types of loans offered:The most common kinds of mortgage loans include conventional loans, FHA loans and VA loans. In addition to these loans, lenders may also offer USDA loans and jumbo loans. Having more options available means the lender can cater to a wider range of applicant needs. We have also considered loans that would suit the needs of borrowers who plan to purchase their second home or a rental property.
• Closing timeline:The lenders on our list can offer closing timelines that vary from as promptly as two weeks after the home purchase agreement has been signed to as many as 45 days after the agreement has been signed. Specific closing timelines have been noted for each lender.
• Fees:Common fees associated with mortgage applications include origination fees, application fees, underwriting fees, processing fees and administrative fees. We evaluate these fees in addition to other features when determining the overall offer from each lender. Though some lenders on this list do not charge these fees, we have noted any instances in which a particular lender does.
• Flexible minimum and maximum loan amounts/terms:Each mortgage lender provides a variety of financing options that you can customize based on your monthly budget and how long you need to pay back your loan.
• No early payoff penalties:The mortgage lenders on our list do not charge borrowers for paying off the loan early.
• Streamlined application process:We considered whether lenders offered a convenient, fast online application process and/or an in-person procedure at local branches.
• Customer support:Every mortgage lender on our list provides customer service via telephone, email or secure online messaging. We also opted for lenders with an online resource hub or advice center to help you educate yourself about the personal loan process and your finances.
• Minimum down payment:Although minimum down payment amounts depend on the type of loan a borrower applies for, we noted lenders that offer additional specialty loans that come with a lower minimum down payment amount.

Note that the rates and fee structures advertised for mortgages are subject to fluctuate per the Fed rate. However, once you accept your mortgage agreement, a fixed-rate APR will guarantee the interest rate and monthly payment remain consistent throughout the entire term of the loan, unless you choose to refinance your mortgage at a later date for a potentially lower APR. Your APR, monthly payment and loan amount depend on your credit history, creditworthiness, debt-to-income ratio and the desired loan term. To take out a mortgage, lenders will conduct a hard credit inquiry and request a full application, which could require proof of income, identity verification, proof of address and more.

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