The Best 30-Year Mortgage Lenders of 2018
What Is a 30 Year Fixed Mortgage?
Shopping for a mortgage is a big deal, and if you’re buying your first house, you may not know where to start with all of the different lenders, loan types and terms available. One of the most popular home purchase loans is the 30-year fixed mortgage, which allows you to pay back your loan over the course of 30 years at a stable interest rate.
There are different types of 30-year fixed mortgages, including conforming mortgages, government-backed, and jumbo loans, but the main idea is that since the loan term is long, you pay much less each month than you would if you took out a 15-year mortgage.
The Top 5 Lenders for 30-Year Mortgages at a Glance
|Lender||APR||Required Credit Score||Best Feature||Visit|
|Starts at 4.18%||Varies per lender||Up to 5 free quotes||Get Quotes|
|Varies||At least 620||FHA, VA, HARP and USDA loans available||Get Quotes|
|Varies||At least 600||500 loan specialists on call||Get Quotes|
|Varies||No minimum||Down payments as low as 3%||Get Quotes|
|Starts at 4.086% but changes frequently||No minimum||Lends up to $3 million||Get Quotes|
The Pros and Cons of a 30-Year Fixed Rate Mortgage
Because 30-year fixed rate mortgages come with lower monthly payments, they are the most popular mortgages in the United States. As with all loans, however, there are pros and cons.
|Lower monthly payment||Higher interest rates|
|Less monthly budget stress||Takes longer to build equity|
|Makes expensive property more affordable||Overall more expensive|
|May qualify for a mortgage interest reduction|
|Easier to qualify|
30-Year Mortgages vs 15-Year Mortgages
If you’re debating as to whether a 30-year mortgage or 15-year mortgage is best for you, here are some things to consider:
- Monthly payment amount: Monthly payments for 30-year mortgages are significantly lower than those of 15-year mortgages—would you be able to afford a higher monthly payment? If not, a 30-year mortgage is better for you.
- Cost of your house: A 30-year mortgage usually makes it more financially feasible to buy a more expensive house, since the payment is spread out over such a long time period. To pay off a very expensive house ($400,000) with a 15-year mortgage means you need to be earning a high yearly income.
- Interest rates: 15-year mortgages come with lower interest rates, which means you can save money in the long run. However, you have to go back to the first bullet and ask yourself, even if I’d like to save money through a lower interest rate, can I actually afford higher monthly payments?
- Your income: Will you have a steady income until you retire? If yes, a 15-year loan is a good option. However, if you’re not sure whether your income will remain steady, a 30-year loan might be a better option, since the monthly payments are smaller and you have a better chance at paying them even if you’re in between jobs.
Best Lenders for 30-Year Mortgages:
Minimum down payment: 5% (with PMI), 20% (without PMI)
LendingTree is not an actual lender but rather a marketplace where you can search for loans based on your parameters. LendingTree works with a network of 350 partners, making it a good option for people who want to shop around and compare rates. When you use LendingTree to search for mortgages, there’s no commitment and it doesn’t affect your credit score.
- Rate as low as 4.125%
- One application for many lenders
- Will retrieve your credit score for you
Best for: Borrowers looking to compare rates and options quickly
Standout Feature: Up to 5 free quotesVisit LendingTree
Minimum down payment: 20% (without PMI)
Applying for a 30-year mortgage through J.G. Wentworth is straightforward and simple; you can do it online or over the phone. J.G. Wentworth offers many types of loans, including federal-backed loans like FHA, VA, HARP, and USDA. Some loan down payments are as low as 3.5% for government backed loans, making it a good option for people who don’t have a large sum to put down but would still like to purchase a home.
- 630+ credit scores accepted
- Low mortgage rates
- Minimum down payment 3.5% for government backed loans
Best for: Borrowers looking for an automated application and loan processing
Standout Feature: Excellent customer service
Minimum credit score: 620 for conventional loans
AmeriSave is a direct lender, but it offers such a large selection of loans that you have the freedom to shop around for the one with the best terms. Rates are fairly competitive and you can apply online or by phone. The website also has great resources to help you figure out which mortgage is best for you, as well as 500 mortgage specialists on call for your convenience.
- Minimum credit score: 600 for government backed loans, 620 for conventional loans
- Over 500 mortgage specialists
- Informational blog
Best for: Borrowers who want quotes without sharing personal information
Standout Feature: Originates and underwrites all loanVisit AmeriSave
Minimum down payment: 5%
Rocket Mortgage, a subsidiary of Quicken Loans, offers a variety of loan options for people in different financial situations. There are many loan types, including conforming and government-backed loans. In some cases, down payments can start as low as 3%. The whole loan process is completed online, and the platform is smooth and seamless.
- Entirely online process
- Impressive customer support
- Speedy application process
Best for: Borrowers who want a live chat option
Standout Feature: Mobile applicationVisit Rocket Mortgage
Minimum down payment: 5%
Quicken Loans offers a quick application process and fast pre-approval for potential borrowers. Rates are updated daily, and there are a lot of loan options available. If you’re looking for a jumbo 30-year mortgage loan, Quicken can lend up to $3 million to qualified customers.
- Online home buyers guide
- Email and text rate updates
- Fast online application
Best for: Tech-friendly borrowers
Standout Feature: Rate as low as 4.6%
Interest rates fluctuate daily, so your quotes might change from day to day and certainly will from year to year. Usually, fluctuation is minimal, but when dealing with hundreds of thousands of dollars, even .01% can be significant. Some experts believe that Monday is the best day to lock in the best rate, though it’s worthwhile asking a loan advisor before committing to anything. For 2017, the average rate for a conventional 30-year loan was 3.99%, ranging from 3.81% in September to 4.17% in February.
Besides daily fluctuation, your rate will also depend on the type of loan you take. In the table below, you can see the rates as of April 30, 2018 for different types of 30-year mortgages. Other factors that affect your rates are your credit score, cost of the house, and your down payment
|Loan||Rate||1-Week Interest Rate Change||APR%||1-Week APR Change|
|Conventional 30-Year Fixed Rate||4.625%||-.05% to .05%||4.688%||-.05% to .05%|
|30-Year Fixed Rate FHA||4.5%||-.05% to .07%||5.568%||-.05% to .07%|
|30-Year Fixed Rate VA||4.625%||-.05% to .07%||4.981%||-.05% to .07%|
|30 Year Fixed Rate Jumbo||4.750%||-.03% to .06%||4.772%||-.03% to -.06%|
Applying for a 30-Year Mortgage
When applying for a 30-year mortgage from any of the above companies, you’ll find that though the process can seem nerve-wracking, it’s actually pretty straightforward. If you’re serious about getting a mortgage, most of these sites offer quotes and possible pre-qualification in a matter of minutes, so all you need to be prepared to do is enter the following information:
- Name, date of birth
- Address, phone number, email address
- Location of house you want to buy, cost, how much down payment you can put down
- Credit score
Once you pre-qualify, you’ll then be asked to submit or upload further documents:
- Proof of income
- Proof of assets
- Cosigner if necessary
- Disclosure of debts
- Various tax paperwork
While some applications can be completed online, you can always speak to a loan officer for help and guidance.
30-year mortgages are the most popular type of home loan in the United States, and for good reason. These mortgages can be paid back over the course of 30 years and they make home purchase possible for people who aren’t earning 6 digits. Because the loan term is quite long, you’ll have a significantly lower monthly payment than you would have with a 15-year loan. The downside is that interest rates and APR are typically higher than 15-year loans, but many people are willing to take it on because they can’t afford huge monthly payments.