Best mortgage lenders for first-time homebuyers in 2024 (2024)

CNBC Selecthas rounded up the best mortgage lenders for first-time homebuyers in a variety of categories. (See our methodology for information on how we made our selections).

Who's this for? PNC Bank's conventional fixed-rate mortgages can have terms as short as 10 years or as long as 30. There's no minimum loan amount and PNC approves jumbo mortgages for up to $5 million, higher than many competitors.

Standout benefits: PNC Bank offers a closing cost grant of up to $7,500 to first-time homebuyers. The Eligible borrowers can qualify for a PNC Community Loan with a down payment of 3% and no private mortgage insurance.

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Who's this for? Need help navigating the home loan process? J.D. Power ranked Bank of America highly for both mortgage origination and servicing and it received an A- from the Better Business Bureau.

Standout benefits: BoA's Down Payment Grant provides up to 3% of ahome'spurchase price in select markets, while the America's Home Grantoffers up to $7,500 toward closing costs.

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Who's this for? You can put 1% down for Rocket Mortgage's RocketONE+ loan with no private mortgage insurance, making this digital-only lender a no-brainer if you have less saved up for your down payment.

Standout benefits: If you buy your house through the Rocket Homes network, you could get a 1.25% rebate for closing costs, up to $10,000.Using the Rocket Visa Signature Card earns points toward a down payment on a future mortgage.

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Who's this for? Guild Mortgage has more flexible credit requirements than many competitors, especially on FHA loans and other government-backed mortgages. It also considers non-traditional credit information, like on-time payments for rent, utilities and insurance.

Standout benefits: Guild's Payment Advantage mortgage pays 1% of your interest rate for the first year. If rates go down, you may be eligible to refinance with no lender fees. Guild also has a 17-day closing guarantee, with qualified buyers receiving a $500 closing-cost credit if they don't close on time.

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Who's this for? Ally Bank doesn't charge lender fees, which can equal up to 2% of your overall loan cost. That lets you put more of your money toward things like moving costs, new furniture and renovations.

Standout benefits: Ally's online preapproval process can take as little as three minutes. Along with conventional mortgages, it offers Fannie Mae HomeReady loans, which only require 3% down and a debt-to-income ratio of 50% or lower.

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Who's this for? Flagstar Bank's Gift Program allows first-time homebuyers in designated areas to receive grants and gifts covering as much as 3% of their purchase price, up to $10,000.

Standout benefits: Through the Flagstar Power-Up program, first-time buyers in select census tracts can receive up to $8,000.

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Who's this for? Chase guarantees eligible mortgages will close on time or borrowers get a $5,000 cash payment.

Standout benefits: The Standard Agency mortgage allows first-time buyers to put down as little as 3%. Current banking customers may qualify for a discount on their mortgage rate.

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Who's this for? The largest issuer of VA loans in the U.S., Veterans United specializes in lending to active-duty service members, veterans and eligible reservists and surviving spouses.

Standout benefits: Veterans United customer service team is available 24/7, making it easier for troops stationed overseas to access. Free credit counseling is also available to help get you approved for the best rate.

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Types of mortgages:
Conventional, FHA, USDA, VA, jumbo, PNC Community, medical professional, construction, renovation, refinancing, HELOCs

Minimum credit score
620 for conventional loan, 580 for FHA

Minimum down payment
0% for USDA and VA, 3% for PNC Community Loan

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Charlotte, North Carolina-based Bank of America is one of the largest banks in the country, with more than 4,600 branches and mortgage loan officers in more than 40 states. Existing BoA customers with at least $20,000 in deposits may qualify for a discount on their origination fee.

Nationwide availability
Available in all U.S. states and the District of Columbia

Types of mortgages
Conventional, FHA, USDA, VA, Affordable Loan Solution, jumbo, physician loan, refinancing, HELOCs

Minimum credit score
580 for FHA

Minimum down payment
0% for USDA or VA, 3% for Affordable Loan Solution

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One of the largest home loan providers in the U.S., Rocket Mortgage regularly tops J.D. Power's mortgage origination and servicing studies and earned an A+ rating from the Better Business Bureau. While there are no physical branches, it has an easy-to-use website and mobile app, where you can check current rates, apply for a mortgage and chat with customer service reps.

Minimum credit score
620 for conventional, 580 for FHA

Minimum down payment
0% for VA loans, 1% for RocketONE+, 3.5% for FHA

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Started in 1960, San Diego-based Guild Mortgagehas more than 200 branches in 32 states. It ranked highly as a mortgage servicer on J.D. Power's 2024 survey and earned an A+ from the Better Business Bureau.

Nationwide availability
Available in all U.S. states except New York

Types of mortgages
Conventional, FHA, USDA, VA, jumbo, construction, refinancing

Minimum credit score
Not disclosed

Minimum down payment
0% for USDA, VA, Arrive Home™ or Zero Down, 1% for conventional loan

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A leading online lender, Ally Bank is known for its speedy preapproval process, shorter closing times and lack of lender fees, though it does not offer government-backed USDA, FHA or VA mortgages. Existing Ally Bank customers may qualify for a discount or cash-back offer on a home loan.

Nationwide availability
Available in all U.S. states and the District of Columbia

Types of mortgages
Conventional, jumbo, HomeReady, refinancing

Minimum credit score
620 for conventional

Down payment minimum
3% for HomeReady

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Servicing 1.4 million home loans in 2023, Flagstaris among the largest mortgage providers in the U.S. by volume and 390 physical branches across 10 states. Flagstar received an A- from the Better Business Bureau but was given a below-average score on J.D. Power's 2024 mortgage servicer satisfaction survey.

Nationwide availability
All U.S. states except Texas

Types of mortgages
Conventional, USDA, VA, FHA, jumbo, refinancing, home equity loans, HELOCs

Minimum credit score
Not disclosed

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

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A division of JPMorgan Chase, one of the nation's oldest financial institutions, Chase has over 4,700 branches nationwide and dedicated home loan advisors in 37 states. It regularly ranks highly on J.D. Power's mortgage origination and servicer satisfaction surveys.

Nationwide availability
All U.S. states and the District of Columbia

Types of mortgages
Conventional, FHA, VA, jumbo, DreaMaker℠, Standard Agency, refinancing

Minimum credit score
620 for conventional, 580 for FHA

Minimum down payment
0% for VA, 3% for DreaMaker℠or Standard Agency; 3.5% for FHA

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Columbia,Missouri-based Veterans United focuses on VA loans, though it does offer other government-backed and conventional mortgages to current and former service members. It received the highest scores in J.D. Power's 2023 U.S. Mortgage Origination Satisfaction Study, as well as an A+ from the Better Business Bureau.

Nationwide availability
All U.S. states and the District of Columbia

Types of mortgages offered
Conventional, FHA, VA, USDA, jumbo, refinancing

Minimum credit score
620

Minimum down payment
0% for USDA or VA, 3.5% for FHA

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A mortgage is a loan used to purchase a home. In most cases, borrowers need to make a down payment upfront —usually between 3% and 20% of the home price — with the remainder of the total cost broken into smaller monthly payments over a set number of years, with interest and other charges added in.

Many people believe you need a down payment of 20% to be approved for a mortgage. But the average down payment in the first quarter of 2024 was just 13.6%, according to Realtor.com, and for first-time homebuyers, it was only 8%. (Repeat homebuyers, who can use proceeds from the sale of their old home, averaged 19%.)

Because they're backed by the federal government, VA loans and USDA loans don't require any down payment. Depending on your credit score, you can get approved for an FHA loan with as little as 3% down.

Most private lenders have community lending mortgages aimed at low- and middle-income buyers that have flexible down payment requirements. Chase's DreaMaker loan requires just 3% down, for example, and Rocket Mortgage will accept as little as 1% with its RocketONE+ loan.

Some lenders have special mortgages for physicians or other professionals: Truist, for example, offers zero-down mortgages of up to $1 million to residents, interns and fellows.

Ultimately, how much of a down payment you need to make depends on a variety of factors:

• How much you can afford: The lower your down payment, the greater your risk of owing more than your home is worth, a situation known as an upside-down mortgage.
• How much you want to pay each month: Putting less than 20% down typically means having to get private mortgage insurance, which can equal as much as 2% of your overall loan per year.
• How much of your home you want to own outright: Home equity, the value of your home minus the debt you still owe on it, is a key consideration in your wealth and net worth.

The state and federal government agencies, private lenders and non-profits all sponsor programs that help first-time buyers and others achieve homeownership.

Many are in the form of grants to put toward closing costs or down payments and come with income or location requirements.

• Bank of America's Down Payment Grant provides 3% of a house's purchase price, up to $10,000, in select markets.
• Chase Bank's Homebuyer Grant provides eligible borrowers with up to $7,500 to lower their interest rate, put towards closing costs or bolster their down payment.
• PNC Bank has a $5,000 grant for low-income borrowers that can be put toward closing costs, a down payment or other prepaid costs.
• Wells Fargo's Homebuyer Access grant provides up to $10,000 towards a down payment for buyers who make no more than 120% of the average median income.

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To determine which mortgage lenders are the best for first-time homebuyers,CNBC Selectanalyzed dozens of U.S. mortgages offered by both online and brick-and-mortar banks and credit unions.

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

• Fixed-rate APR:Variable rates can fluctuate over the life of your loan. With a fixed rate APR, you lock in an interest rate for the duration of the term.
• 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 is able to 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.
• 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.
• Flexible minimum and maximum loan amounts and 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 their loans 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 down payment amounts depend on the type of loan, we noted lenders that offer specialty loans with lower minimums that first-time buyers can take advantage of.

After reviewing the above features, we sorted our recommendations by the best for flexible terms, customer service, low down payments low minimum credit scores, no lender fees, homebuyer grants, for applying in person and for veterans and service members:

We also considered CNBC Select audience data when available, such as general demographics and engagement with our content and tools.

Listed mortgage rates and fee structures may fluctuate in accordance with the Federal fund rate.

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